Few days after Prime Minister Narendra Modi's massive victory in India's national election, international rating agency S&P Global Ratings has said the reform potential of new government is likely to maintain buoyancy in local funding markets and improve the flow of foreign capital for corporates in India.
The rating agency also said that Indian corporates, especially the rated ones, remain hostage to a number of worries surrounding a slowdown in global growth and trade wars. But now, the continuity of government -- which was widely cited as an additional source of uncertainty in the run-up to the elections -- is no longer one of them.
According to the S&P Global Ratings, improvements in India's bankruptcy code, simplification of the country's tax regime and privatization of inefficient state-owned enterprises are all expected to create opportunities for private enterprises going forward. It further added that a focus on the revival of private consumption may boost growth in much-needed private investment.