India’s Outlook Cut to Negative by Moody’s
- Moody’s sees budget deficit widening to 3.7%, debt rising
- Growth slowdown will be prolonged amid financial sector stress
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Moody’s Investors Service cut India’s credit rating outlook to negative, citing a litany of problems from a worsening shadow banking crunch and a prolonged slowdown in the economy to rising public debt.
The sharp slowdown in growth and a surprise corporate-tax will put government finances under pressure this year. Moody’s is projecting a budget deficit of 3.7% of gross domestic product in the year through March 2020, a breach of the government’s 3.3% target.