Weak fiscal strength to remain key credit challenge for India: Moody's

Agency says it may be challenging for govt to push through material revenue reform given general elections that need to be held by mid-2024, as well as various state elections before then

Indian economy’s fiscal strength is unlikely to improve in the medium term, thus remaining a key credit challenge compared with peers, even as the FY23 budget’s focus on capital expenditure will support near-term growth, rating agency Moody’s Investors Service said on Friday.

“The government did not foreshadow any potentially significant measures to broaden the tax base, appearing to rely on healthy tax buoyancy and increasing tax compliance to drive revenue, at least through the forthcoming budget year. Moreover, it may be challenging for the government to push through material revenue reform given general