RTTNews - Formation of a stable government at the Centre will have positive implications for India's sovereign rating, global agency Standard and Poor's said on Thursday. However, it didn't say when it would review the country's rating.
Generally speaking political stability is a positive factor for the sovereign rating. Because of strong mandate, next government will have a better opportunity to execute its policy agenda, Standard and Poor's Director, Sovereign and IPF Ratings, Takahira Ogawa said.
However, it is too early to comment on the impact of formation of a stable government at the Centre, he said, a better political environment itself will not warrant to progress in the areas such as fiscal consolidation, deregulations and public sector reforms, to improve main constraining factors for sovereign ratings of India.
Earlier in January, the agency evoked a sharp reaction from the finance ministry after it changed the outlook for long-term ratings, which was pegged at BBB, from 'stable' to 'negative'.
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