S&P downgrading is an alarm for India, but not panic: Pranab

Finance Minister Pranab Mukherjee Wednesday stated that credit rating agency Standard & Poor's (S&P) recent move to lower down India's rating from balance to negative is a timely warning signal, but he however assured that it is not a panic situation.

Mukherjee's remark came a day after S&P's move to step down India's credit rating in negative, which upset Indian government.

Standard & Poor's is one among the three world's global credit rating agencies that measures the financial status of public and private sector companies and also indicates the current financial condition of any country.

Reacting to S&P's move, FM said, India is returning on the track of faster economic growth and it can register its Gross Domestic Product (GDP) rate to around or above 7% while its rising fiscal deficit is also to be cooled to 5.1% of the GDP in this financial year 2012-13.

"I am concerned, but I don't feel panicky because I am confident our economy would grow at seven per cent, about seven per cent, if not more. We will be able to control the fiscal deficit, and it would be about 5.1 per cent," said Mukherjee to the reporters.

In budget, he has pegged India's growth rate at 7.6% for FY 2012-13.

"We should continue to work for higher GDP growth....We will take note. It is a timely warning....So, economic reforms will be on track," he added.

Despite several measures to curb inflation, the food price index and essential commodity index have gone up and Reserve Bank of India, the master bank has raised policy rates 13 times since last four years to curb inflation and reduce fiscal deficit.

--With Agencies Inputs--