Fitch affirms BBB- sovereign rating, sees 6% hike in FY24 – Times of India

New Delhi: Global rating agency Fitch on Tuesday affirmed India’s sovereign rating at BBB (minus) with a stable outlook. It said the strength of a strong growth outlook compared to peers and resilient external finances have aided India in weathering major external shocks over the past year, but weak public finances remain a constraint.
“We forecast the Fitch-rated sovereign to be one of the fastest growing globally at 6% in the financial year ending March 2024 (FY24), supported by resilient. Investment possibilities. However, contrary to high inflation, high interest rates and recession global demandWith pent-up demand driven by the fading pandemic, growth will slow from our FY23 estimate of 7% before rebounding to 6.7% by FY20. Fitch Ratings Said.
Other rating agencies such as S&P and Moody’s also have the lowest investment grade rating for India with a stable outlook. The action of rating agencies will help in adding to the positive sentiment and bring down the cost of borrowing by the firms. Fitch said a strong growth potential is an important supporting factor for the sovereign rating.
“Growth prospects have brightened as the private sector appears poised for strong investment growth after improving corporate and bank balance sheets over the past few years, supported by the government’s infrastructure drive. Nevertheless, risks remain given the low labor force participation rate and uneven reform implementation record,” the agency said.
It added that India’s large domestic market makes it an attractive destination for foreign companies.