India makes strong pitch for rating upgrade by Moody's:R Gopalan

NEW DELHI: India has impressed upon rating agency Moody's to upgrade its sovereign rating which has remained static for seven years despite improvement in various parameters, a senior Finance Ministry official said.

"We made a strong pitch (for upgrading India's sovereign rating)...We presented detailed facts. We answered their (Moody's) doubts and queries," Department of Economic Affairs Secretary R Gopalan told reporters here on the sidelines of a function today.

He said this while answering questions on a meeting between officials of the Finance Ministry and the representatives of the rating agency Moody's.

"We compared our rating with countries which have similar rating and assured them that we are better in most attributes. So, if we are better in attributes than most of the other countries, then how come we are at Baa3 for seven years. That kind of facts and research was marshelled to them", he said.

Moody's had last upgraded India's rating to 'Baa3' (with stable outlook) in 2004. Baa3 means medium grade with moderate credit risk.

India, he added, has also taken up the similar issue with another rating agency Fitch.

Credit ratings are important as they help the rated entities to negotiate better interest rates on borrowings.

The Finance Ministry officials had urged Moody's to upgrade India's rating to Baa1, two notches above its current rating.

The officials had pitched for higher rating on back of good long-term growth prospects, favourable demographics, low external debt to GDP ratio, high foreign exchange reserves, deep domestic capital markets and diversified domestic holdings of sovereign debt.