![India's rating upgrade possible in next 24 months if fiscal deficit falls to 4%: S&P](https://th-i.thgim.com/public/incoming/w7glo8/article68364159.ece/alternates/LANDSCAPE_1200/PTI6_10_2024_0010100001B.jpg)
India's rating upgrade possible in next 24 months if fiscal deficit falls to 4%: S&P
The Hindu
A sovereign rating upgrade for India in the next 24 months is possible if the central government is able to prudently manage its finances and bring down fiscal deficit to 4% of GDP, an S&P Global Ratings official said on July 3.
A sovereign rating upgrade for India in the next 24 months is possible if the central government is able to prudently manage its finances and bring down fiscal deficit to 4% of GDP, an S&P Global Ratings official said on July 3.
S&P Global Ratings Director, Sovereign Ratings, YeeFarn Phua, said the trigger for upgrade would be general government (Centre + states) deficit falling below 7% of the GDP, and a lot of this would have to be driven by the central government.
“If the central government is able to bring down fiscal deficit to 4% of the GDP, we will consider a rating upgrade over the next 24 months,” Mr. Phua said.
The central government estimates to bring down fiscal deficit to 5.1% of the GDP in the current fiscal, from 5.63% in 2023-24.
As per the fiscal consolidation roadmap, the deficit — the difference between government expenditure and revenue — will be brought down to 4.5% by 2025-26.
The U.S.-based rating agency had in May upgraded outlook for India to positive, from stable, while retaining the rating at ‘BBB-’.
Phua further said the Indian economy has clocked an average of 8% growth in the last three years, driven by domestic consumption and infrastructure investment that has made real difference on the ground.
![](/newspic/picid-1269750-20240704173828.jpg)
Revenues from the seven-year old Goods and Services Tax had not lived up to expectations, having attained pre-GST levels only now, and the objective of a ‘Good and Simple Tax’ remains elusive, former Chief Economic Advisor Arvind Subramanian said, terming the lack of critical data such as refunds a challenge.
![](/newspic/picid-1269750-20240704084815.jpg)
Surging markets: CJI Chandrachud advises SEBI, SAT to be cautious, pitches for more tribunal benches
CJI Chandrachud said that SEBI and appellate fora like SAT assume “immense national importance” in fostering a stable and predictable investment environment, and explained how this can benefit in economic growth for the country.