India not downgraded below investment grade: Moody's

There is a rumour that the Moody’s might have downgraded India to lower than investment grade. Aninda S Mitra, VP and Senior Analyst (Sovereign Risk), Moody's clarified on the rumour by saying that the rating is Baa3 for the foreign currency bonds and Baa2 for the local currency bonds and the outlook is stable for India.

Excerpts from CNBC-TV18’s exclusive interview with Aninda S Mitra:

Q: Is there any truth to this that Moody’s has downgraded India’s rating?

A: The rating is Baa3 for the foreign currency bonds and Baa2 for the local currency bonds and the outlook is stable.

Q: So no change in rating at all?

A: Absolutely nothing. The outlook is stable.

Q: Have you put India on review or anything in the light of the recent macro problems that the country is facing; ballooning fiscal deficit, lower capital flows? Is India on some sort of review?

A: When we do put countries on reviews it is publicly disclosed. We have not done anything of the sort. We are watching the difficulties that India is facing, as are several other countries. India is not unique in this. So, there is absolutely no truth to this rumour that you brought up and the outlook remains stable.

Q: When is India due for review again? In normal circumstances, when would you examine India’s rating once again?

A: We put out the annual report towards the end of the year. The transition from one analyst to another was released a bit late in this review cycle. The rating is under surveillance all the time and we take things as they come.

Q: Following the May report, which we have now for India, has there been any change in the stance towards India?

A: There has been no change and the outlook is stable.