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Markets will remain closed on 19th & 20th October 2017.
We wish all our readers a very Happy Diwali!

India facing Brazil like rating risk?
Mon, 12 Oct Pre-Open

Global rating agency Standard & Poor's (S&P) recently stated that it does not expect to upgrade India's sovereign debt rating anytime soon. Currently S&P rates India at 'BBB-Minus' with a 'stable' outlook. It is the lowest investment grade as per their rating norm.

India's positioning in the sovereign debt market and its consequences on the economy.

S&P's prime concern is the slow pace and absence of quality reforms for its reluctance to upgrade the credit ratings. Over the past 12 months, important legislations such as Land Acquisition Act, Goods and Service Tax Act, Labour Act have failed to get passed in the Parliament due to lack of consensus. GST was to be made effective from the next financial year. However the same seems to be impossible now.

government slowed the pace of fiscal consolidation. Fiscal consolidation is a policy effort by the government to bring down the fiscal deficit and public debt. It includes efforts to raise revenues and bring down wasteful expenditure such as subsidies. Finance Minister in his budget speech delayed the deadline for cutting the fiscal deficit to 3% of GDP by one year to 2017-18. Considering crude prices to be at low levels, rating agency stated that the quality of fiscal consolidation was not as good as it could have been.

Recently Brazil was downgraded to 'junk' rating by S&P. The move took a hit on the financial markets in Brazil.

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Oct 19, 2017 (Close)