India's sovereign rating fixation

Should Indian policymakers be concerned about India's existing sovereign rating?

The fifth-largest economy in the world has never been rated at the lowest level of investment grade in the history of sovereign credit ratings, noted the latest Economic Survey. It marshalled plenty of evidence to underscore that sovereign ratings do not capture India’s fundamentals. It has several factors in its favour. India has a history of zero default. India’s stock of foreign currency-denominated sovereign debt is very low. In fact, even non-government short-term debt is worth less than 20 per cent of foreign exchange reserves. Foreign exchange reserves worth over $580 billion provide added comfort and increase India’s ability to