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Dec 11, 2012
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S&P warns India of junk rating, cites fiscal deficit
The Indian government's wide fiscal deficit and a heavy debt burden are the most "significant rating constraints" to the country's sovereign rating, Standard & Poor's said, reiterating its warning that India faces a one-in-three chance of being downgraded to junk over the next 24 months. "Broadly, India's fiscal profile is a rating weakness," S&P said in a note, echoing views made in an October note.
"Given the political cycle - with the next elections to be held by March 2014 - and the current political gridlock, we expect only modest progress in fiscal and public sector reforms," it said. The rating agency, which in April cut India's outlook rating to negative from stable, said it did not expect the government to reach its fiscal deficit target of 4.5% of gross domestic product in the fiscal year that ends in March 2014.
Source -
http://www.financialexpress.com
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