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S&P refusal to upgrade India’s rating not to impact economic prospects: SBI

Standard & Poor's on Friday maintained its sovereign rating on India stable at ‘BBB-’ while keeping its outlook for India stable.

Reported by: IANS, Mumbai [ Published on: November 25, 2017 13:53 IST ]
File pic of SBI's Chairman Rajnish Kumar
File pic of SBI's Chairman Rajnish Kumar

State-run State Bank of India (SBI) said on Friday said that rating agency Standard & Poor's (S&P) refusal to upgrade India's sovereign rating will have no major impact on the country's economic prospects.

Earlier in the day, the American rating maintained status quo on India's sovereign rating at BBB- with a stable outlook, a development that comes a week after Moody's did an upgrade.

"That S&P did not upgrade India's sovereign rating will have no impact on the country's economic prospects. In fact, just last week Moody's has upgraded the sovereign rating," state-run SBI's Chairman Rajnish Kumar told reporters here on the sidelines of the launch of SBI's integrated lifestyle and banking digital platform YONO.

Signalling a boost to investor sentiments last week, US agency Moody's Investor Service upgraded India's sovereign rating to Baa2 from its lowest investment grade of Baa3 after 14 years, while changing the outlook to stable from positive, and said its upgrade was based on the Indian government's "wide-ranging programme of economic and institutional reforms".

"If you see the overall business environment in India and the reforms undertaken in recent years, a rating upgrade was long overdue and Moody's have done so," said the chairman of the largest Indian lender.

Also Read: S&P keeps India's sovereign rating unchanged at 'BBB-minus'; govt says action unfair

"If S&P have not done so, it is their prerogative, but it will have no impact whatsoever," he added.

While granting a stable outlook for India, S&P said that there could be downward pressure on the ratings if GDP growth disappoints, if net general government deficits rose significantly, or if the political will to maintain India's reform agenda significantly lost momentum.

 

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