“The response to the various reform measures like FDI in multi brand retail, clarity on retrospective tax laws, firm measures to curtail mounting subsidy on fuel has been well reflected in increased FIIs inflows and positive movements in the capital markets and appreciation of rupee. Therefore the warning of S & P that India still stands the risk of further downgrade is an overstatement and unwarranted,” said Rajkumar N. Dhoot, President, Assocham, in statement.
He further said that the process may take some time but seems to be well underway and 'we are very sure that the Indian economy will be back in the growth trajectory'. Under these circumstances, the rating agency has clearly over done the threat perception to Indian economy.
Notably, the S&P downgrade warning came a day after the International Monetary Fund (IMF) trimmed India's growth forecast for the calendar year 2012 to 4.9%.
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