Moody’s rating upgrade for India was ‘long overdue’: Chief Economic Adviser Arvind Subramanian
Railway Minister Piyush Goyal said India is ‘entering into a golden era of growth and prosperity’.
Chief Economic Adviser Arvind Subramanian on Friday said India’s credit rating upgrade by Moody’s Investors Services was “long overdue”. The ratings agency has upgraded India’s local and foreign currency issuer ratings to Baa2 from Baa3 and changed the outlook on the rating to stable from positive.
Subramanian said on Twitter that the Moody’s upgrade was a recognition of reforms undertaken by the government, including a new indirect tax structure, a plan to recapitalise public sector banks and a bankruptcy code.
He also cited his Economic Survey for 2016-’17, which was released in January, in which he had criticised the methodology used by the global ratings agencies. He ha then said that such agencies were slow in upgrading India despite “dramatic improvement” in growth since 2014.
Railway Minister Piyush Goyal also welcomed the upgrade, saying it gives confidence to investors, and is a “big message for the entire investor community”, ANI reported. The government expects more investments after the upgrade, and “I think we are entering into a golden era of growth and prosperity for the country”, Goyal was quoted as saying.
Earlier in the day, Finance Minister Arun Jaitley said the rating upgrade will force those with doubts about India’s economic reforms to “seriously introspect on their positions”.
Moody’s believes that the Indian government’s economic reforms, including the Goods and Services Tax and demonetisation, will enhance the country’s growth potential.
“We believe it is a belated recognition of all the positive steps that have been taken in India in the past few years,” the finance minister said, adding that the upgrade boosted the government’s “determination to follow the track that we have embarked upon”.