NEW DELHI: Finance ministry officials on Friday met Moody’s team and sought a rating upgrade from the global agency, as per sources. They also questioned the agency about the parameters on which it rates the economy of countries.
“Last year, Moody’s retained India’s sovereign credit rating of Baa3 with a stable outlook, while Indonesia was rated at Baa2. We have questioned the parameters on the basis of which they gave a better rating to Indonesia,” a top source told this newspaper. Last year, Moody’s mentioned “stable outlook reflects our view that the risks from negative feedback between the economy and financial system are receding”.
Earlier this year, top finance ministry officials had met the heads of top global rating agencies, Fitch and S&P Global, and pitched for a rating upgrade on the back of better economic dynamics post-Covid-pandemic. Fitch kept India’s sovereign rating at ‘BBB-’ with a stable outlook on the back of robust growth and resilient external finances.
However, it mentioned that the weak public finances remain a challenge for the country. Meanwhile, S&P Global Ratings retained India’s sovereign rating at ‘BBB-’ with a stable outlook. It said that India’s strengths lie in a fast-growing economy and strong external balance sheet while highlighting its weak fiscal performance and low GDP per capita.
Besides this, the ministry officials discussed the borrowing plans of the country, its disinvestment targets for current fiscal and state budgets with Moody’s representatives. According to sources, the global agency acknowledged the positives of the Indian economy.
These meetings are conducted every year and a series of interactions happen over the course of the year.
“The government explained the assessment of the economy to Moody’s to help it analyse the country’s state of economy in a more coherent way. The meeting happened in the most cordial atmosphere,” a ministry source said.
The government, for the full year, estimated GDP to have grown 7.2% in FY23, according to the second advance estimates of national income, as compared with 9.1% in FY22. The Indian economy registered a growth of 6.1% in the last quarter of FY23, as against the growth of 4.5% in the previous quarter, according to the government data.
Officials discuss fiscal targets, borrowing plans
Ministry officials discussed the borrowing plans of the country, its disinvestment targets for current fiscal and state budgets with Moody’s representatives. According to sources, the global agency acknowledged the positives of the Indian economy