India better placed than peers over US rate hike: Fitch

Significant improvement in India's external balances since mid-2013, less dependence than several peers on commodity exports to aid India, says Fitch

India is better placed than many of its peers after the American central bank, the US Federal Reserve, raised its key interest rates, said credit rating agency Fitch Ratings on Thursday.

"India is not immune to potential general emerging market jitters related to the Fed lift-off, but it is better placed than many of its peers for a number of reasons," Thomas Rookmaaker, director, Sovereign Ratings, Fitch Ratings was quoted as saying in a statement.

According to him, firstly India's external balances have significantly improved since mid-2013, with foreign exchange reserves rising by some $65 billion to $353 billion as of November 2015 and the current account deficit narrowing.

Secondly, India is less dependent than several of its peers on commodity exports, and has thus not been negatively affected by the global rout in commodity prices, he added.

"Only a small part of India's sovereign debt is held by foreigners or is denominated in foreign currency. Fourth, India's favourable economic growth outlook makes India relatively attractive for foreign investors," he added.