InvestorQ : Why has Moody’s downgraded India’s growth rate for FY22?
swati Bakhda made post

Why has Moody’s downgraded India’s growth rate for FY22?

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Sam Eswaran answered.
1 month ago
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Moody’s Investors Service scaled down the projected GDP growth of the Indian economy for FY22 from 13.7% to 9.3%. that is a fairly sharp downgrade of more than 400 basis points. Moody’s has specifically issued a warning that if the second wave was not arrested on time with a major vaccination drive, even these lowered estimates could be derailed.

Moody’s has held India’s rating just above speculative grade but with negative outlook. Moody’s is apprehensive that high debt burden and weak financial system could exacerbate sovereign risks for India. Moody’s believes the bigger risk is the logistical challenge of reaching out to a large rural population, where COVID is spreading at a rapid rate.

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