Fitch, a US based rating agency kept India’s rating unchanged at BBB- citing weak fiscal position as a reason.
The rating agency has continued to assign Indian debt the lowest investment grade rating with stable outlook; the same was assigned to Indian 11 years ago.
Fitch indicated that India’s GDP will grow by 7.7% in fiscals 2017 and 2018 which would be a favourable jump from 7.1% growth in fiscal 2016.
Indian government and many economists have questioned the global rating agencies with the arguments of improving economic fundamentals and reforms, asking if all these measures have been considered while assigning the rating.
India’s Economic Survey 2017 had slammed rating agencies for their inconsistent standards while rating India v/s China and asked them to considered reforms measures such as GST.
In 2006, Fitch upgraded India’s sovereign rating from BB+ to BBB- with stable outlook.
In 2012, it changed the outlook to negative and then re-changed back to stable in 2013.
Fitch said: “The sovereign ratings at BBB- balance a strong medium-term growth outlook and favourable external balances with a weak fiscal position and difficult business environment”.
It also said that the current BJP government has consistently rolled out many reforms for last three years and is committed to continued reforms.