Moody's warns India, says double digit growth sans reforms 'dangerous'

According to the report, the global environment has stabilised in recent months, with Europe muddling through and most of the US data looking better. The biggest change, however, is that the government is now on a steady path of fiscal and regulatory reform and better governance.

The so-called big bang of economic reforms announced since August has helped to lift corporate confidence and should translate into better spending and capital expenditures from mid-2013, it said.

Risks around the economy, particularly the fiscal and current account deficits, have begun to recede.

The WPI inflation has moderated to 6.62 per cent in January, after remaining close to double digit in most part of 2012. Besides, the current account deficit (CAD), which is the difference between the inflow and outflow of foreign currency, has peaked to 5.4 per cent in July-September quarter.