Fitch 'warns' India to implement reforms or face rating downgrade
Finance Minister P Chidambaram during investor roadshows in the past fortnight had said that the government was committed to reign in the fiscal deficit at the mandated levels of 5.3 per cent for FY13 and cut it down further to 4.8 per cent in FY14.
The road shows, held in Hong Kong, Singapore and Frankfurt, come after reform measures like relaxing foreign holding norms in multi-brand retail and aviation, increasing rail fares, raising the limit on foreign investment in rupee bonds, and a gradual plan to align diesel prices with market realities.
A host of factors like inaction on the policy front, slowdown in growth and the perceived inability to meet fiscal deficit targets had led rating agencies like Fitch and S&P to downgrade their outlook on the country's sovereign rating in mid-2012 to negative from stable.
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