Lok Sabha Question No. 5124 (UNSTARRED), answered on 2023-04-03
Subject: Credit Worthiness of the Country
Ministry: FINANCE
Asked by: Shrirang Appa Barne, Sanjay Sadashivrao Mandlik, Sambhajirao Mane Dhairyasheel, Prataprao  Jadhav, Bidyut Baran Mahato, Sudheer Gupta

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 5124

TO BE ANSWERED ON MONDAY, APRIL 3, 2023 / Chaitra 13, 1945 (Saka)

## Credit Worthiness of the Country

5124. SHRI SHRIRANG APPA BARNE

SHRI SANJAY SADASHIVRAO MANDLIK

SHRI DHAIRYASHEEL SAMBHAJIRAO MANE

SHRI PRATAPRAO JADHAV

SHRI BIDYUT BARAN MAHATO

SHRI SUDHEER GUPTA

Will the Minister of FINANCE be pleased to state:

- (a) whether the country's economic matric/credit worthiness have improved significantly since the pandemic and if so, the details thereof;
- (b) whether the Government has held any meeting with the officials of top international rating agencies  recently  and  if  so,  the  details  and  the  outcomes  thereof  along  with  the  reasons therefor;
- (c) the steps taken/being taken by the Government to upgrade the sovereign credit rating of the country;
- (d) the details of target set by the Government for deduction of fiscal deficit to GDP for current year and the next three years to put the country on to the path of economic development; and
- (e) the other steps taken by the Government to enhance economic growth of the country?

## ANSWER MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

- (a) Yes  Sir.  The  outlook  for  India's  sovereign  credit  ratings  has  improved  during  the  pandemic. Ratings assigned/affirmed by key Credit Ratings Agencies in the pandemic period is enclosed as Annexure I .  India's  strong  economic  growth  and  resilience  to  external  shocks  have  been  key drivers of the improved sovereign credit profile.
- (b) & (c) Yes Sir. The Government of India has been proactively engaging with prominent global credit rating agencies (CRAs) to improve India's sovereign credit ratings over time. Concerted efforts have been made during periodic credit review meetings, transparency calls and outreach by senior officials  of  the  Government  to  sensitise  CRAs  about  the  fundamentals  of  the  Indian economy, latest economic developments, growth perspective, fiscal consolidation and commitment to reforms.
- (d) The Fiscal Deficit is estimated at 6.4 per cent of GDP for RE 2022-23 and 5.9 per cent of GDP for  BE  2023-24.  Further,  the  Government  has  announced  its  intention  of  reducing  the  Fiscal Deficit to a level below 4.5% of GDP by FY 2025-26 in Union Budget 2021-22. Nonetheless, in light of continued global uncertainty, the Medium-Term Fiscal Policy cum Fiscal Policy Strategy Statement FY 2023-24 does not outline any medium-term fiscal projections.
- (e) The Government of India has taken series of measures to enhance economic growth including substantial increase in capital expenditure outlay, Production Linked Incentive (PLI) Scheme and reforms in various sectors.

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## Annexure I

## Ratings assigned / affirmed by key Credit Ratings Agencies during Pandemic

| Rating Agency   | Year   | Foreign Currency   | Foreign Currency   | Local Currency   | Local Currency   | Remarks                                          |
|-----------------|--------|--------------------|--------------------|------------------|------------------|--------------------------------------------------|
|                 |        | Ratings            | Outlook            | Ratings          | Outlook          |                                                  |
| Moody's         | 2022   | Baa3               | Stable             | Baa3             | Stable           | Outlook improved from Negative to Stable in 2021 |
| Moody's         | 2021   | Baa3               | Stable             | Baa3             | Stable           | Outlook improved from Negative to Stable in 2021 |
| Moody's         | 2020   | Baa3               | Negative           | Baa3             | Negative         | Outlook improved from Negative to Stable in 2021 |
| Fitch           | 2022   | BBB-               | Stable             | BBB-             | Stable           | Outlook improved from Negative to Stable in 2022 |
| Fitch           | 2021   | BBB-               | Negative           | BBB-             | Negative         | Outlook improved from Negative to Stable in 2022 |
| Fitch           | 2020   | BBB-               | Negative           | BBB-             | Negative         | Outlook improved from Negative to Stable in 2022 |
| S&P             | 2021   | BBB-               | Stable             | BBB-             | Stable           | Outlook has remained unchanged.                  |
| S&P             | 2020   | BBB-               | Stable             | BBB-             | Stable           | Outlook has remained unchanged.                  |