Don't panic: Pranab seeks calm after S&P downgrade India

[kawaraj]

Finance minister Pranab Mukherjee said there was "no need for panic" after the rating agency Standard & Poor's downgraded the country's outlook from stable to negative on Wednesday.

India is likely to pass some financial reforms in the current session of Parliament, which started on
'Govt not in a position to bring reforms' Monday, he added.
"There is no need for panic," Mukherjee told reporters.

"The situation may be difficult, but we will be surely able to overcome (it)," he said.

The lowered outlook jeopardises India's long-term rating of BBB-, which is the lowest investment grade rating.

"The outlook revision reflects our view of at least a one-in-three likelihood of a downgrade if the external position continues to deteriorate, growth prospects diminish, or progress on fiscal reforms remains slow in a weakened political setting," S&P credit analyst Takahira Ogawa said in a note.

India's 10-year bond yield rose 4 basis points to 8.63%, while the rupee weakened to 52.64 against the dollar from 52.48 before the action.
....

Moody's has a Baa3 rating on India, while Fitch rates India BBB-. Both are also the minimum investment grade ratings. Moody's in December issued a stable outlook for India.

Don't panic: Pranab seeks calm after S&P downgrade - Hindustan Times

 

[kak1978]

Good, this is like a kick in the back of the UPA government, which will have to something about the policy paralysis and hopefully some meaningful reforms take place.

 

[DDLJ]

The Economic slowdown is because of policy paralysis, global slowdown, anti-corruption movement which is in fact a short term phenomenon, Indian economy will again bounce upward.

 

[Chinese-Dragon]

The Economic slowdown is because of policy paralysis, global slowdown, anti-corruption movement which is in fact a short term phenomenon, Indian economy will again bounce upward.

How will policy paralysis be reversed?

Will Congress suddenly be able to control their allies, and make strong decisions on behalf of the country?

 

[IndoCarib]

The UPA govt is dragging its feet on economic reforms with an eye on 2014 gen elections. I expect the NDA govt coming to power and going full steam ahead with the reforms. Until then its tortoise time.

 

[SpArK]

Most shares which fall back recovered well before market ended.

May is expected to be positive.

No need to panic.

 

[IndoCarib]

How will policy paralysis be reversed?

Will Congress suddenly be able to control their allies, and make strong decisions on behalf of the country?

No hope for any policy paralysis reversal any time soon. The Congress and their important ally Mamta are at loggerheads all the time. She will fight tooth and nail any reforms MMS moots, just for the sake of antagonism

 

[DDLJ]

How will policy paralysis be reversed?
Will Congress suddenly be able to control their allies, and make strong decisions on behalf of the country?

Yes, there are chances, Samajwadi Party is ready to co-operate with them, they are the one who helped the Congress during Communist opposition of Indo-US nuclear Deal and when anti-America communist withdraw support. Mamta Banerjee is leftist oriented and won't agree with government for reforms. But it all depends upon the decision of present government.

 

[JAT BALWAN]

No hope for any policy paralysis reversal any time soon. The Congress and their important ally Mamta are at loggerheads all the time. She will fight tooth and nail any reforms MMS moots, just for the sake of antagonism

No need of Mamtas for any jeopardy in Congress party, Minister like Sharad Pawar is enough for making all the world wonder about his policies & off course his replies to press about any agricultural crisis are epic...
God knows when this "tede muh wala" will die & make a path for someone like him in congress...

Every body knows that India`s economy mostly depends on agriculture, one bad mansoon will put a huge effect on that years data....
but Congress stuck to this cimpangi face for his good...

 

[kawaraj]

Ratings agency Standard and Poor's has warned that India's worsening deficits and diminishing growth prospects could lead to a downgrade of its economy.

The agency retained the rating at BBB-, but said it was changing its outlook from stable to negative.

It said economic growth for the 2012-13 financial year would be 5.3%, which is far lower than the government's projection of 7.6%.

Finance Minister Pranab Mukherjee said there was no cause for panic.

"I am confident that the economy will grow at around 7%," Mr Mukherjee said.

"We will be able to pursue fiscal deficit and it will be around 5.1% of the GDP."

Standard and Poor's credit analyst Takahira Ogawa said in a statement on Wednesday that India's investment and economic growth prospects had slowed and its current-account deficit had widened, "resulting in a weaker medium-term credit outlook".

"We are revising the outlook on the long-term ratings on India to negative," he said.

BBC News - Standard and Poor's warns India on credit rating

 

[Patriot]

Indians were talking about China's Bubble - Looks like Indian Bubble is about to burst anytime soon.

 

[kawaraj]

S&P's forecast of next fiscal of India is even below my expectation, 5.3 percent is horrible number to a moving economy, a shock that could cast the shadow of fundamental risk.

 

[Rajaraja Chola]

mamata and JJ are two ladies, hell bent on opposing anything good UPA brings be it economic reforms or on security....

 

[kawaraj]

you need at least change your FM at present, his policy has proven to be HUGELY false. the rating hike was unreasonable and he fault the monetary policy and fiscal policies.

 

[DDLJ]

you need at least change your FM at present, his policy has proven to be HUGELY false. the rating hike was unreasonable and he fault the monetary policy and fiscal policies.

The problem don't lies with FM, PM or HM, all three are intelligent guys.