India Government Debt Remains 'Significantly' High, Moody's Says
- Implementation of GST is a positive and will help productivity
- Warns bad loans could weigh on credit profile in the near term
Indian two thousand rupee banknotes are arranged for a photograph in Mumbai.
Photographer: DHIRAJ SINGH/Bloomberg via Getty ImagesIndia’s general government debt level is "significantly" higher compared with similarly rated countries, Moody’s Investor Service said, firing a fresh salvo at Prime Minister Narendra Modi’s government which has been trying hard to earn a sovereign upgrade.
Rating agencies have India just above “junk” status and while Modi’s government has consistently pushed for a sovereign upgrade in the past few years, Moody’s, Standard & Poor’s and Fitch Ratings have all pushed back, citing high debt levels. On Thursday, Moody’s said that while the general government debt level declined to 67.5 percent of gross domestic product in 2016 from 84.7 percent in 2003, it remains a “key credit constraint.”