Sovereign rating risk

Govt must take steps to avoid a downgrade

Daily Covid-19 cases are showing initial signs of stabilising, with India reporting less than 300,000 cases for the first time since April 21. However, the caseload is still very high, and it might take a while before the situation is brought under control in a meaningful way. The impact of the second wave and a potential threat of a third wave mean state governments would be cautious in permitting public mobility. Forecasters are lowering their growth projections for the current fiscal year, and, as news reports suggest, lower economic growth, which would increase fiscal stress, can also put pressure on