Industry body Assocham today rejected Standard & Poor's threat to downgrade India's rating, and said the global agency's warning is an "overstatement and unwarranted".
"S&P threat to downgrade India's rating is an exaggeration and does not reflect the true state of affairs about the Indian economy where bold reforms process has already commenced with a big bang and the results will follow no sooner than later," Assocham President Rajkumar Dhoot said in a statement.
Not impressed by a series of economic reforms, Standard & Poor's has yesterday threatened to downgrade India's sovereign credit rating to junk grade within 24 months in absence of steps to check fiscal deficit and improve investment climate.
Dhoot said there are no systemic risks to the economy and the recent reform measure including permitting FDI in retail, clarity on retrospective tax laws and measures to curtail subsidy on fuel by the government reflects its commitment in mending the economy and to restore investors confidence.
"The response to these measures has been well reflected in increased FIIs inflows and and appreciation of rupee. Therefore the warning of S&P that India still stands the risk of further downgrade is an overstatement and unwarranted," he added.
He also said that the process may take some time and the industry is very sure that the Indian economy will be back on the growth trajectory.
"Under these circumstances, the rating agency has clearly over done the threat perception to Indian economy," he added.