Rating rationale

India must walk the talk on deep structural reforms

The decision of Standard & Poor’s (S&P) to affirm India’s sovereign credit rating with a stable outlook will help contain the uncertainty in financial markets to some extent, as a downgrade from the lowest investment grade would have added to the volatility. Fund managers at various global insurance and pension funds are not expected to invest in securities of non-investment grade countries, which can affect the flow of funds. Although India has managed to retain its investment-grade rating, the economy would require careful policy interventions to be able to strongly recover from the Covid-19 downturn and strengthen the medium-term growth