The lockdown imposed to prevent the pandemic Coronavirus and its infection has caused major damage to the Indian economy, after several rating agencies reduced India's GDP growth forecast for the current financial year, now rating agency Moody's Investors Service has released India's sovereign Credit rating has been reduced Moody's has reduced India's rating after nearly 22 years. Moody's has reduced it from BAA2 to BAA3.
In its statement, Moody's Investor Service says that India will face challenges such as weak economic growth, deteriorating financial situation and pressure in the financial sector in the coming time, as well as the agency has estimated that the country's GDP in the current financial year may decline by up to 4 percent. This will be the first time in nearly 40 years that the country's annual GDP will decline. That is why the rating agency has reduced India's sovereign credit rating.
Moody's said, 'The agency has also reduced India's local currency senior un-guaranteed rating from BAA 2 to BAA 3, as well as short-term local currency rating has been reduced from P-2 to P-3'. It is said that in the coming times, many challenges will be faced by the policy makers of India to bring the economy back on track. Moody's had reduced India's sovereign credit rating in 1998 after the country conducted a nuclear test about 22 years ago. Moody's downgraded the rating. The agency raised India's sovereign credit rating by a notch to BAA2 in November 2017.