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Non-Tech : ICICI Ltd - (Nyse: IC) -- Ignore unavailable to you. Want to Upgrade?

To: Mohan Marette who wrote (307)	3/3/2000 1:36:00 PM
From: Mohan Marette	Read Replies (1) \| Respond to of 494

India's Debt Ratings Hinge On Budget Implementation Friday, March 3 5:19 AM SGT NEW YORK (Dow Jones)--The implementation of India's new budget is the key to the country's credit rating. Rating agencies said Thursday that no immediate rating actions would result from the approval of India's 2000/2001 budget. Noting that the passage of a more realistic budget bodes well for the government's chance to deliver on its promises, three leading rating agencies said they didn't expect to change their views on India immediately. "The budget announcement won't lead to a change in rating or outlook," said Standard & Poor's analyst Joydeep Mukherji. "A change in rating outlook will depend clearly on implementation," he added. S&P rates India's foreign currency bonds `BB' with a stable outlook. Meanwhile, Moody's Investor Services' Kristin Lindow also said that her agency didn't expect to upgrade its `BA2' foreign currency rating on India in the short term. Lindow said, although Moody's positive outlook means that there is a better than 50% chance that the country's rating would be put on review in the next 12 to 18 months, "there is no guarantee that we'll review it." She added that Moody's, like S&P, will wait for signs of real implementation before making a decision. Although India's new budget lacks ambition, Lindow said, it may prove superior to previous budgets. "The situation in the last several years has been one where very ambitious budgets weren't met," she said. "In many respects (this more realistic budget) may be something to look forward to. They could actually reach these goals and maybe even outperform them." All Eyes On Government's Implementation S&P's and Moody's views were echoed by Duff & Phelps Credit Rating Co. "The key, as always, is implementation of measures announced in the budget," said DCR's Shelly Shetty in a recent statement. "India has not met its fiscal targets in three years running," Shetty said, adding that "fiscal consolidation efforts have seriously lagged promised reforms in recent years." DCR currently assigns India's a `BB+' foreign currency rating with a stable outlook. India's proposed budget for 2000/2001 targets a fiscal deficit of 5.1% of the gross domestic product, a small adjustment from an estimated 5.6% deficit last year. "The bottom line is that (the budget) doesn't look very ambitious, but at least it's realistic," Moody's Lindow said. S&P's Mukherji concurred. "If the track record improves, it could bode well for the rating outlook," he said. "But this will be a slow moving thing." "Now that India has a stable government, everyone is looking at India and paying a little more attention," he said.