India’s 'BBB-/A-3' rating affirmed; Outlook stable, says S&P
NEW DELHI - India's economy will experience a record contraction in fiscal 2021 (ending March 31, 2021), largely owing to the global COVID-19 pandemic, according to ratings agency Standard and Poors, which is expecting India's real GDP growth to recover from fiscal 2021 onwards.
India's weak fiscal settings will worsen further this year, S&P says, constraining the Government's ability to aid the economy, but at the same time, the country's external settings have improved, helped by the central bank's rapid accumulation of foreign exchange reserves.
"We are affirming our 'BBB-' long-term and 'A-3' short-term foreign and local currency sovereign credit ratings on India." S&P says.
"The stable outlook reflects our view that India's contraction in fiscal 2021 will be followed by a significant recovery, which will stabilise the country's broader credit profile."