India’s fiscal challenges are a key constraint to the country’s sovereign rating, and the credit agency will closely monitor the government’s consolidation plans at its next annual budget, Thomas Rookmaaker, a director at Fitch Ratings said on Tuesday.
Rookmaaker added Fitch hoped to see lower subsidy payouts and more reforms that will push up revenue growth and ease the government’s market borrowing at the country’s next budget due around February.
Shoring up its fiscal position would be more important than economic growth, the Fitch analyst also said.
“Some difficult choices (need) to be made by the government in the budget,’’ Rookmaaker told a media briefing in Mumbai.
Fitch had on Monday retained its “BBB-minus’’ rating with a “stable’’ outlook for India.