New Delhi, Feb 25: Global rating agencies have put under surveillance India`s sovereign rating, which determines foreign lenders` confidence in corporates, in view of its widening fiscal deficit caused by three stimulus packages since December.
The fresh warning from Moody`s and Fitch comes a day after
Standard & Poor`s downgraded India`s sovereign outlook from
stable to negative.
Expressing concern at the fast deterioration of the
fiscal situation in India than in many countries, Moody`s
Investors Service today said India`s sovereign ratings remain
under surveillance.
Moody`s will review the ratings after the elections, based
on the fiscal policy stance of the new government, Moody`s
Senior Analyst Aninda Mitra told reporters from Singapore on phone.
It will also take into consideration the effectiveness of
the stimulus packages provided by the government so far and
the impact on the fiscal deficit, he said.
Also "concerned" at the structure of Indian government`s
finances, Fitch said it will assess India`s ratings in future
on the basis of measures taken for strengthening public
finances.
The government yesterday announced a fresh cut in excise
duty and service tax that would result in a revenue loss of
over Rs 29,000 crore, which may further increase fiscal
deficit by 0.5 percentage points.
Bureau Report
