Indian officials have met with Moody's to press for an upgrade in the country’s sovereign ratings. The representatives discussed borrowing, disinvestment targets and state budgets with the rating agency. The Indian officials are hopeful that Moody's will raise India's "Baa3" rating, the lowest investment grade, backed by the country's impressive growth outlook and other positive macroeconomic markers.
India's key officials discussed borrowing, disinvestment targets and state budgets with Moody's today, the finance ministry official, who didn't wish to be named, told ET Now.
Consultations and reviews between governments and rating agencies are commonplace. Nonetheless, like in previous instances, the meeting between FinMin officials and Moody’s on Friday is unlikely to bear fruit, Madan Sabnavis, Chief Economist, Bank of Baroda, had told ET Online.
Moody's has retained its sovereign rating for India at the lowest investment grade of "Baa3" with a "stable" outlook.
Moody's on Thursday had said the key factors for India's fiscal strength and credit profile will be debt affordability and projected a downward trend for the debt burden. "As long as nominal GDP growth holds, India's debt burden will be stable or decline slightly," Moody's said.
Earlier this year, the ministry had held similar meetings with two other global rating agencies - Fitch and S&P. However, both maintained such ratings for India at the same level - "BBB-" with a "stable" outlook - in their May reviews.
Ratings play a significant role in how global investors gauge the country's creditworthiness and also impact the borrowing costs. The ratings hold importance for Indian companies that wish to borrow money from overseas, as it is believed by many that the rating of a company cannot be better than its country.
While reviewing India's rating in May, S&P and Fitch conceded the country's strong growth outlook and external sector resilience compared with peers. At the same time, they also flagged the country's weak public finances, illustrated by high deficits and debt relative to peers, and elevated interest burden
India’s gross domestic product (GDP) crossed $3.5 trillion in 2022. Economists have opined that India will be the fastest-growing G-20 economy over the next few years. While multiple countries continue to struggle with higher inflation post-pandemic, India is seen to be on a much more stable footing..
For Vietnam, Moody's Investors Service, a leading provider of credit ratings, research, and risk analysis, has raised ratings of eight Vietnamese banks.
Accordingly, Moody's has upgraded the long-term local (LC) and foreign currency (FC) deposit and issuer ratings of eight banks by one notch.
These banks are Vietcombank, BIDV, OCB, SeABank, TPBank, Agribank, VIB and VietinBank.
Meanwhile, the LC and FC Counterparty Risk Ratings and Counterparty Risk Assessment of seven banks were raised by one notch, including BIDV, Agribank, VietinBank, ABBank, LienVietPostBank, SHB and MSB.
In 2022, Moody's upgraded Viet Nam's long-term issuer and senior unsecured ratings to Ba2 from Ba3 and changed the outlook to stable from positive, making the nation the only in Asia-Pacific and one of the four countries globally to have ratings upgraded by Moody's.
The upgrade to Ba2 reflects the assessment by Moody's that Viet Nam's economy has growing strengths and greater resilience to external macroeconomic shocks that are indicative of improved policy effectiveness.
