Given the reliability of the estimated number in the budget, Tarun Bajaj hoped that the global rating agencies would maintain India's sovereign rating at the current level.
Economic Affairs Secretary Tarun Bajaj said India's sovereign rating should not come under pressure due to the widening fiscal deficit, which was mainly due to higher costs to meet the COVD-19 epidemic.
Given the reliability of the estimated number in the budget, he hoped that the global rating agencies would maintain India's sovereign rating at the current level.
According to the latest budget numbers, India's fiscal deficit is projected at 9.5% of GDP in the current financial year and is projected to come down to 6.8% in 2021-22 starting April 1.
The impact of the epidemic on economics led to moderation in tax collection and an increase in government spending, which resulted in a huge borrowing of 12.8 lakh crore from the market.
“I don’t think the rating will be under pressure because every country in the world was affected by the Kovid-19 epidemic. This crisis was not limited to India. Our recovery is faster than in the Western world. In the budget, the marginal growth rate of GDP is 1.5..5 per cent, said Mr. Bajaj PTI In an interview.
“They should look at our budget and the reforms that the government has made. The government will join them and explain the numbers. We hope they maintain ratings, & # 39; & # 39; Said the secretary of the Department of Economic Affairs (DEA).
Last month, the Economic Survey 2020-21 observed that India’s sovereign credit ratings do not reflect the basic principles of the economy for a sovereign credit rating system to become more transparent and less subjective.
"Never in the history of sovereign credit ratings has the world's fifth largest economy been rated as the lowest in the investment-grade (BBB- / BA3) range. Classy credit ratings do not reflect the fundamentals of the Indian economy, while noisy, opaque and biased credit ratings hurt the flow of FPI.
"The recent episodes of rating changes have nothing to do with macroeconomic indicators or so… India's monetary policy should not be viewed as a noisy / partisan move by India's fundamentals and should instead fearlessly reflect Gurudev Rabindranath Tagore's sentiments," he said. Said.
Global rating agencies have the lowest investment-grade rating in India, above the junk position.
In June, Fitch Ratings downgraded India's outlook from "stable" to "negative" and reaffirmed the "BBB-" rating, saying the coronavirus epidemic had significantly weakened the country's growth prospects for years and exposed the challenges facing the general public. . -Bound burden.
Moody's Investors Service downgraded India's sovereign rating to "Ba2", saying there would be challenges in implementing policies to mitigate the risks of low growth and deteriorating financial conditions.
S&P Global Ratings maintained the "BBB-" rating for India for the 13th consecutive year in June last year.
