Citing improvement in macroeconomic conditions and the commitment to fiscal consolidation, the Indian government has pitched for a ratings upgrade with global agency Fitch Ratings. Economic Affairs Secretary Shaktikanta Das after a two-hour long meeting with the representatives of the agency, said that “We highlighted the overall economic situation and in all the major sectors the challenges which the economy faces and what is the outlook for the next year.”
During the meeting, finance ministry officials highlighted the reform initiatives of the government which include new bankruptcy code, creation of interest rate setting monetary policy committee and amendments to the Debt Recovery Tribunal (DRT) and Sarfesi Acts. It was also said that in order to reset the fiscal goal post in the long run, the government has set up a committee to review the long-term fiscal target.
The ministry officials also reiterated the government's commitment to introduce Goods and Services Tax (GST) at the earliest. Chief Economic Advisor Arvind Subramanian had earlier said the government has pitched for a rating upgrade with Fitch and stated that finance ministry is committed to fiscal consolidation path.
Fitch Ratings which had in December affirmed India’s ‘BBB-’ rating with a stable outlook, and had forecasted 8 percent growth for 2016-17, said that it is in the process of review and it is going to take some time. ‘BBB-’ is the lowest investment grade and just a notch above junk grading.
