Encouraged by India?s efforts to contain fiscal deficit and inflation, global rating agency Fitch has said it is unlikely to make any change in India?s sovereign ratings in the short term. The observation has come at a time when Standard and Poor?s , has cautioned that a downgrade for India is possible if it fails to handle the problems of rising inflation and fiscal deficit diligently. Responding to queries from FE, Fitch Asia Sovereign Ratings director Art Woo said the rating agency was encouraged by the recent response of the RBI in tightening monetary policy, which should help cool inflationary pressure. ?…though it appears that the Union Budget?s fiscal deficit target of 4.6% of GDP for 2011-12 may not be met due to the rising cost of subsidies, the potential slippage is unlikely to be significant,? Woo said.
