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Showing posts from December, 2017

A Fair Acknowledgement

Over the past few months, there has been growing debate on the performance of the Modi administration. Sceptics have argued that things are stumbling and have used events such as the aftermath of demonetisation, GST implementation slippages and more recently, a drop in GDP output, as the basis of their contention. Be that as it may, the fact is India’s structural parameters are presently more robust, substantiated in clear terms by Moody’s recent upgrade. Its local and foreign currency paper is now rated Baa2 from Baa3, placing its economy in the same category as Italy, Spain and the Philippines. Moody’s decision reflects its assessment that structural initiatives of the administration will in the longer term enhance India's growth potential, reduce the government’s debt burden and provide greater stability against macroeconomic shocks. Interestingly, Moody’s last upgrade took place 14 years ago during the Vajpayee era. Many analysts had expected, some months ago, that ratings