The Finance Ministry on Tuesday told representatives of global rating agency Moody’s that even though India’s economic scenario was not ‘fully rosy’, the country’s growth story remained credible with the government fully committed to address the problems.

Speaking to reporters after a customary meeting with Moody’s representatives before the global agency settles down to have a re-look at India’s sovereign rating and outlook based on the country’s latest economic parameters, DEA (Department of Economic Affairs) Secretary Arvind Mayaram said: “...it’s not as if the picture is fully rosy... All we have said is that we know there are problems but we have to take actions in a particular manner and the government is fully committed to take action so that the problems that we are seeing today are fully addressed.”

It was in January this year that Moody’s reaffirmed a sovereign rating of ‘Baa3’ for India, indicating ‘investment grade’ status with a stable outlook.

According to Dr. Mayaram, during the discussions at North Block, Moody’s representatives wanted to know, in particular, the steps that have been taken by the government to check the subsidy bill and its fall-out on the fiscal deficit as well as the impact that the proposed legislation on right to food would have on the exchequer. Incidentally, since the last meeting with Moody’s in January, the fiscal deficit and the inflation numbers have significantly improved, especially after the government took a number of tough policy measures such as virtual deregulation of diesel prices and pruning of subsidies on domestic LPG cylinders, fertilizer and sugar.

Same points, additional numbers

As to whether the Moody’s representative acknowledged the improvements in the economy, Dr. Mayaram said: “We raised the same points but with additional numbers. Everyday the numbers improve...The last time we had met [Moody’s], they [the numbers] have improved further. So that’s a good sign…We have a credible story that we have told them and they [Moody’s] have appreciated what we have said. Now rest is up to them.”

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