Investment reforms to aid India’s growth: Standard & Poor’s

NEW DELHI: Reforms that strengthen fiscal health and improve investment climate could boost India’s growth prospects, global credit ratings firm Standard & Poor’s has said.

India is expected to grow in excess of 6% next financial year starting April, after an around 5.5% expansion this year. “Further reforms that improve the investment climate and strengthen fiscal health in India and Indonesia could brighten long-term growth prospects,” S&P said in its review of Asia-Pacific ratings.

S&P has a BBB-minus – the lowest investment grade – rating on India with a stable outlook. In its review in September, the ratings firm had pointed to a possible upgrade.

“We could raise the rating if the economy reverts to a real per capita GDP trend growth of 5.5% per year and fiscal, external, or inflation metrics improve,” it had said.

Inflation has already moderated significantly and growth is looking up. The new government has taken measures to improve sentiment, which are “welcomed by investors”, it said in a report.