Finance Minister Arun Jaitley on Friday said the government welcomes Moody’s upgradation of India’s sovereign rating.
In a press address following the upgrade, the finance minister said the upgradation is a belated recognition of all the positive steps the Centre has taken so far.
It is “encouraging to have international recognition” and “not something happening in isolation,” he said.
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The steps taken by the government in the last few years have contributed to the strengthening of the Indian economy, and the upgradation is an endorsement of the ongoing reform process, he said.
He added, the number of structural reforms that have taken place in the last three to four years have placed India “on path of a high trajectory growth”.
On mention of India’s fiscal prudence in the Moody’s report, Jaitley said “India continues on the path of fiscal prudence which has brought stability to the economy.”
Defending demonetisation, he said it has helped in taking the economy towards formalisation and digitalisation, and the success was being universally acknowledged.
The government had successfully implemented the Insolvency and Bankruptcy Code (IBC) 2016, recapitalisation, and setting up of the RBI’s Monetary Policy Committee.
He also lauded the smooth transition of the Goods and Services Tax (GST).
The finance minister said that the government’s emphasis was on “implementation and reaping benefits of the growth process”.
The “emphasis is on infrastructure building and expenditure in rural areas,” he added.
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Earlier on Friday, the US-based credit rating agency Moody’s had upgraded India’s sovereign credit rating by a notch to ‘Baa2’ with a stable outlook citing improved growth prospects driven by economic and institutional reforms.
The rating upgrade was the first in 13 years. Moody’s had last upgraded India’s rating to ‘Baa3’ in the year 2004. In 2015, the rating outlook was changed from ‘stable’ to ‘positive’.
The global ratings agency, however, cautioned that high debt burden remains a constraint on the country’s credit profile.
Rejoicing at the news, the Rupee opened with its biggest gain in four years at 64.72/USD.
Driven by banks after Moody’s upgrade, the Sensex rallied 400 points.