Rating agency S&P Global on frifay maintained the country's foreign and local currency sovereign credit rating at BBB (-) long-term and A-3 short-term. The rating agency has said in its statement that its outlook on the long-term rating of the country is stable. The COVID-19 epidemic will lead to a record decline in Indian economics in this business year (2020-21).
This rating means that India has the ability to meet its financial liabilities, but due to economic conditions, there is a risk for India. The same COVID-19 had a very bad impact on the country's economics - the rating agency said that COVID-19 has a very bad impact on India's economy. There is a permanent loss of about 13 per cent in production as compared to the pre-COVID-19 stage.
Also, the country's major credit weaknesses (high general government deficit and heavy debt) have increased further. Slower economic recovery will also weaken the government's revenue outlook in this business year. That will improve the real GDP growth of the country- According to the S&P rating agency, the real GDP growth of the country will start to improve from the coming business year. The BBB (-) is the worst investment grade rating on the rating agency's scale. The rating agency says a sharp increase in the Indian forex reserves is a good sign for India. There can be many changes as well.
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