S&P calls India's budget 'cautious', says has no impact on ratings

MUMBAI Thu Jul 10, 2014 7:17pm IST

Finance Minister Arun Jaitley (C) poses as he leaves his office to present the budget for the 2014/15 fiscal year, in New Delhi July 10, 2014. REUTERS/Stringer

Finance Minister Arun Jaitley (C) poses as he leaves his office to present the budget for the 2014/15 fiscal year, in New Delhi July 10, 2014.

Credit: Reuters/Stringer

Related Topics

MUMBAI (Reuters) - Standard & Poor's Ratings Services said on Thursday India's budget had adopted a "cautious" approach in tackling some of economy's structural weaknesses and said it would have no bearing on the country's sovereign rating.

"The commitment of the new Indian government to maintaining the trend of fiscal consolidation would benefit the sovereign's credit fundamentals. However, the budget announced today has opted for a cautious approach toward tackling some of the economy's structural weaknesses," S&P said in a statement.

Earlier, Finance Minister Arun Jaitley unveiled a budget that seeks to revive growth and curb borrowing, but left open questions on how it will reduce the fiscal deficit.

S&P added the budget would have "no immediate impact" on India's sovereign rating. The agency is the only of the three major ratings providers to rate India with a "negative" outlook.

S&P said it could lower India's rating to below investment-grade from the current "BBB-minus" rating should the new government prove unable to reverse India's low economic growth.

Alternatively, S&P said it could revise the outlook to stable if the government can restore some of India's "lost growth potential and consolidate its fiscal accounts."

(Reporting by Rafael Nam)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS EXCLUSIVE

REUTERS SHOWCASE

Modi In U.S.

Modi In U.S.

Obama, Modi work to deepen improving U.S.-India ties  Full Article | Related Story 

Factory Activity

Factory Activity

Factories expand at slowest pace this year in September  Full Article 

Videocon d2h IPO

Videocon d2h IPO

Videocon d2h files for up to $113 million IPOs  Full Article 

Asian Economy

Asian Economy

Asian factories slow in Sept, push inflation ever lower  Full Article 

EBay Divests PayPal

EBay Divests PayPal

EBay follows Icahn's advice, plans PayPal spinoff in 2015  Full Article 

New 'Windows'

New 'Windows'

Microsoft names next operating system 'Windows 10'.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage