‘Fundamentals remain quite robust’: India slams Moody’s negative outlook rating
New Delhi | Jagran Business Desk: Reacting to Moody’s Investor Service changing its outlook on India's ratings to negative, the government on Friday said that the fundamentals of the economy remain quite robust and series of reforms undertaken recently would stimulate investments.
The Finance Ministry, in a statement on Friday, said that India continues to be among the fastest-growing major economies in the world.
“India's relative standing remains unaffected,” said the ministry while citing International Monetary Fund's (IMF) recent World Economic Outlook putting Indian economic growth at 6.1 per cent in 2019 and rising to 7 per cent in the year after.
“As India's potential growth rate remains unchanged, assessment by IMF and other multilateral organisations continue to underline a positive outlook on India,” it further said.
The Finance Ministry also said that the government has undertaken series of financial sector and other reforms to strengthen the economy as a whole.
“Government of India has also proactively taken policy decisions in response to the global slowdown. These measures would lead to a positive outlook on India and would attract capital flows and stimulate investments,” the ministry said.
“The fundamentals of the economy remain quite robust with inflation under check and bond yields low. India continues to offer strong prospects of growth in the near and medium term,” it added.
Meanwhile, Indian shares inched lower after Moody's Investors Service lowered its ratings outlook to "negative" from "stable".
However, losses in equities were capped as realty stocks extended their sharp gains from the previous session.
"Market reaction will depend on institutional view on the development, will FIIs cut India exposure remains to be seen," said Deepak Jasani, head of retail research at HDFC Securities.
"If they agree with Moody's assessment and don't have an alternative, there may not be a rush to exit," he added.
The broader NSE Index was down 0.23 per cent at 11,986.50, as of 0355 GMT, while the benchmark BSE Index fell 0.18 per cent to 40,585.72. The rupee weakened as much as 0.49 per cent to 71.31 against the dollar.
The Nifty PSU Bank index, which tracks state-run lenders, was the top loser among NSE sectoral indexes, slipping nearly 1 per cent.
Oil marketing companies Hindustan Petroleum Corp Ltd and Bharat Petroleum Corp Ltd declined over 1.4 per cent each.
(With PTI and IANS inputs)
Posted By: Aalok Sensharma