More than 75 per cent respondents said exposure to large corporates in power, steel and infrastructure sectors poses as the greatest risk to banks' asset quality in India.
The firm sees sustained economic growth, commissioning of additional production capacity and higher commodity prices that will boost corporate earnings in India.
Moody's, which has a 'Baa3' rating with a positive outlook, said evidence of policymakers working towards a faster fiscal consolidation, reducing the debt-GDP ratio and addressing infrastructure and monsoon volatility challenges will determine an upgrade, going forward.
Moody's, which has a 'Baa3' rating with a positive outlook, said evidence of policymakers working towards a faster fiscal consolidation, reducing the debt-GDP ratio and addressing infrastructure and monsoon volatility challenges will determine an upgrade, going forward.
Moody's Investors Service today said the reforms undertaken by the government will help boost investor confidence and bolster growth potential, but cautioned muted private investment and banking sector risks will remain a constraint on India's sovereign rating.
"In Moody's view, over time, the multi-pronged but step-wise approach to reform will foster a stable macroeconomic environment. In particular, the cementing of the monetary policy framework with the objective of maintaining inflation at moderate levels is credit positive.
GDP growth forecast for India has been maintained at 7.5 percent, says Marie Diron, Senior VP - Sovereign Risk Group, Moody's Investors Services who believes India now looks relatively less vulnerable than earlier.
Moody's Investors Service Senior VP Marie Diron said the inflation target is a credit positive re-affirmation of the commitment to keeping inflation at moderate levels.
The long-pending indirect tax reform Goods and Services Tax (GST) Constitutional Amendment Bill was passed by the Rajya Sabha yesterday.
Talking about the possible review of the FRBM Act, Marie Diron, Senior Vice President, Moody's Investors Service, said the change of fiscal deficit targets will not have any immediate implications.
More worryingly, policymakers are lacking the tools to deal with any unexpected negative shock, after years of ultra-low interest rates and high-profile liquidity injections, according to the ratings agency.
The report said that at the end of 2014, there were USD 800 billion of developing countries' bonds outstanding issued by offshore subsidiaries -- some 2.5 times five years earlier.