Moody’s Delegates Hold Meeting with Finmin Officials
Moody’s Reviews India’s Sovereign Rating Amid Ongoing Economic Concerns
In response to persistent allegations of bias towards emerging economies, officials from Moody’s Ratings engaged in discussions with representatives from India’s finance ministry, including Chief Economic Advisor V Anantha Nageswaran, regarding their routine assessment of India’s sovereign rating. This dialogue follows Moody’s recent adjustment of India’s GDP growth forecast for 2025, revising it downward from 6.5% to 6.3%. (Image Source: Reuters)
Against the backdrop of claims of inequitable treatment by global rating agencies, Moody’s Ratings representatives convened with finance ministry personnel on Thursday to gather insights into the Indian economy in preparation for their forthcoming rating evaluation. Sources hinted that the ongoing tensions between India and Pakistan could play a role in Moody’s upcoming judgment of India’s sovereign rating.
On May 21, Moody’s indicated that the escalating conflicts between Pakistan and India, particularly the recent flare-up earlier this month, are expected to impact Pakistan’s economic growth more significantly than India’s. Following that, Moody’s reduced India’s GDP predictions for 2025 to 6.3%, attributing the change to a global economic contraction spurred by increased uncertainty surrounding US policies and trade restrictions.
Additionally, on Thursday, Moody’s executives met with finance ministry officials, including Chief Economic Advisor V Anantha Nageswaran, for their customary interaction. Back in December 2023, economists from the finance ministry criticized the three major global rating agencies for maintaining India’s rating at the lowest investment grade for a continuous period of 15 years, despite the country’s ascent from being the 12th largest economy to the fifth largest. They argued that the methodologies employed by these rating agencies exhibit a bias against developing emerging market economies.
Currently, Moody’s holds India’s sovereign rating at ‘Baa3’ with a stable outlook.
