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May 04, 2013, 05.55 PM IST | Source: CNBC-TV18

India's rating upgrade unlikely anytime soon: S&P

Rating agency Standard and Poor's (S&P) today ruled out rating upgrade of India anytime soon. S&P warn that reform announcements recently made by the government did not suffice to ensure growth.

Amid high public-debt levels and concerns about deficit and subsidies, the India growth story still remains positive, global rating agency Standard and Poor's (S&P) said today. However, the rating agency ruled out rating upgrade of India anytime soon.

India's growth track record is good in current circumstances as the RBI attempts to counteract loose fiscal policy . The market has factored in one ore two rate cuts this year, the agency added.

However, S&P warn that reform announcements recently made by the government did not suffice to ensure growth. The agency also pointed out that a large number of infrastructure projects were stuck and those in the pipeline were "historically bad".

Investments must be unlocked for growth and the government must find short to mid-term solutions of problems in the infrastructure, power and coal sectors.

Offering a global perspective, S&P said that Asia-Pacific growth would not be impacted by problems in the US and eurozone and in fact, forecasts Asia Pacific economies to perform better from hereon. "Nobody expects the eurozone to recover by next year and will muddle through while the US economy will pick up going ahead," the agency said.

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