Business Daily from THE HINDU group of publications
Wednesday, Jan 17, 2007
ePaper
Business Daily from THE HINDU group of publications Wednesday, Jan 17, 2007 ePaper |
|
|
|
|
|
|
|
|
|
|
|
Home Page
-
Economy Industry & Economy - Credit Rating Difficult to sustain 9 pc growth: Moody's Our Bureau
Mumbai , Jan. 16 India may not be able to sustain the 9 per cent growth rate after one or two years, said Ms Kristin Lindow, Vice-President and Senior Credit Officer, Moody's Investors Service. There are capacity constraints like infrastructure and overheating of the economy, which may dampen the current level of growth, she said. Consumer credit and high inflation beyond the RBI's projected limit of 5-5.5 per cent are signs of an over-heating economy, she pointed out at a press briefing here on Tuesday. The ratings agency said that India's healthy external position is reflected in an investment grade Baa3 foreign-currency rating but heavy public debt constrains its domestic-currency rating to speculative grade Ba2. "Growth surprised on the upside in the first half of the current fiscal year," she said in the annual report on India. "India's robust economic momentum seems to defy the constraints posed by its inadequate infrastructure and inefficient government sector." "A debate is taking place among policy makers whether the fiscal consolidation targets of the Fiscal Responsibility and Budget Management Act should be relaxed in order to allow Government to increase its investment spending to meet more of the infrastructure shortfall," said Ms Lindow, in an official statement. "However, any such easing would signal undue complacency about the Government's large debt and debt service burden, potentially exacerbating the overheating economy and spurring higher inflation and interest rates."
Related Stories: More Stories on : Economy | Credit Rating
Article E-Mail :: Comment :: Syndication :: Printer Friendly Page
|
Stories in this Section |
|
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription Group Sites: The Hindu | The Hindu ePaper | Business Line | Business Line ePaper | Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2007, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line
|
