The Finance Ministry today said that Moody’s Investor Services has, in addition to the three upgrades on December 20 last year, has also upgraded India’s short-term country ceiling on foreign currency bank deposits.
“There has been another upgrade by Moody’s with the short-term country ceiling on foreign currency bank deposits going up from NP (not prime) to P-3 (prime: acceptable ability to repay short-term obligations),” said Thomas Mathew, joint secretary, capital markets.
Mathew added that the upgrade indicated, “you could see entry of capital into this segment also”.
The short-term debt of the commercial banks stood at Rs 3,732 crore as on September 2011. It was Rs 4,554 crore at the end of September 2010.
On December 20, 2011, Moody’s had upgraded the ratings on long-term and short-term government bonds denominated in domestic currency and long-term country ceiling on the foreign currency bank deposits to investment grade from speculative.
In its investor services global credit research, Moody’s had underlined government’s efforts at fiscal consolidation.
Moody’s upgrade followed a positive rating action by Dominion Bond rating Services (DBRS). They upgraded the trend of India’s long-term foreign and local currency debt rating from negative to stable outlook in June 2011.
In the same month, Fitch had also appreciated the management of economy by India and had affirmed its ratings issued in the previous year.
The rating agencies, Fitch and Standard & Poor’s are slated to visit India between March and May, after the presentation of the Union Budget for 2012, said officials.