India deserves upgrade in sovereign rating: Chidambaram

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SME Times News Bureau | 22 May, 2013
India deserves a rating upgrade in the background og improving macro economic situation, Finance Minister P Chidambaram said in New Delhi on Tuesday.

"Our case is that we deserve an upgrade both on the outlook and the rating. S&P may not have been convinced about that...," Chidambaram told reporters on the sidelines of the Annual Day function of the Competition Commission of India.

"There is nothing to worry. Our macro-economic position today is much better than what it was in August 2012," he said, adding that the Indian economy was entering a new phase of strong growth.

Recently, ratings agency Standard & Poor's (S&P) Friday had said its outlook on India remained negative and there is a one-in-three chance of a downgrade within the next 12 months.

But the government had asserted that there is nothing to worry about as it is taking the right measures to keep the country on a sustainable growth path.

S&P's 'BBB-' is lowest investment grade and a downgrade would mean pushing the country's sovereign rating to junk status, making overseas borrowings by corporates costlier.

Since assuming office in August last year, Chidambaram has been taking a number of steps to put the economy back on track, through increased investments and cut fiscal deficit.

While the fiscal deficit in 2012-13 has been contained below the budgeted 5.2 per cent, the government proposes to further lower it to 4.8 per cent in the current fiscal.