Fitch Ratings on Thursday downgraded India’s outlook to ‘negative’ from ‘stable’, stating that poor management of coronavirus pandemic has significantly weakened the country’s growth prospects for the year and exposed the challenges associated with a high public-debt burden.
The move comes after another rating agency Moody’s earlier this month downgraded India’s sovereign rating by a notch to lowest investment grade of ‘Baa2’ for the first time in 22 years.
“Fitch Ratings has revised the outlook on India’s long-term foreign-currency issuer default rating (IDR) to negative from stable and affirmed the rating at ‘BBB-‘,” the rating agency said in a statement.
Fitch expected economic activity to contract by 5 per cent in the fiscal year ending March 2021 (FY21) due to the strict lockdown measures imposed since March 25, before rebounding by 9.5 per cent in FY22.
“The coronavirus pandemic has significantly weakened India’s growth outlook for this year and exposed the challenges associated with a high public-debt burden. The rebound will mainly be driven by a low-base effect,” it said.
While Countries in Europe and Newzealand has excelled in controlling the pandemic curve to flatten but India even after 4 hours abruptly done lockdown on March 24 that result millions of migrants workers stranded .
Many factors added to improper COVID-19 management ensured India pandemic cases rising continuously and as on date India stand at 4th Global rank with 367,963 Corona Pandemic patines and with 12,272 deaths India rank 8th place in Global
‘Developing Asia’ refers to a group of over 40 countries that are members of the Asian Development Bank (ADB)
Earlier Excluding the newly industrialised economies of Hong Kong, China; the Republic of Korea; Singapore; and Taipei, China, Developing Asia is forecast to grow 0.4 per cent this year and 6.6 per cent in 2021, it said.
Hit hard by Covid-19, South Asia is forecast to contract by 3 per cent in 2020, compared to 4.1 per cent growth predicted in April. Growth prospects for 2021 are revised down to 4.9 per cent from 6 per cent, it said.
“India’s economy is forecast to contract by 4 per cent in fiscal year (FY) 2020, ending on 31 March 2021, before growing 5 per cent in FY2021 (to be ending March 2022),” according to the ADB said in a supplement to its Asian Development Outlook (ADO)