MUMBAI (S&P Global Ratings) Nov 25, 2017--S&P Global Ratings affirmed its unsolicited
long- and short-term foreign and local currency sovereign credit ratings on the Republic
of India at 'BBB-/A-3'. The outlook is stable.
"The stable outlook reflects our view that, over the next two years, growth
will remain strong, India will maintain its sound external accounts position,
and fiscal deficits will remain broadly in line with our forecasts," a statement of S & P said.
It said upward pressure on the ratings could build if the government's reforms
markedly improve its net general government fiscal out-turns and so reduce the
level of net general government debt. Upward pressure could also build if
India's external accounts strengthen significantly.
Downward pressure on the ratings could emerge if GDP growth disappoints,
causing us to reassess our view of trend growth; if net general government
deficits rose significantly; or if the political will to maintain India's
reform agenda significantly lost momentum.
The ratings on India reflect the country's strong GDP growth, sound external
profile, and improving monetary credibility. India's strong democratic
institutions and its free press promote policy stability and compromise, and
also underpin the ratings. These strengths are balanced against
vulnerabilities stemming from the country's low per capita income and
relatively high general government debt stock, net of liquid assets.