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    Question

    Which is NOT correct about India’s sovereign rating by Fitch?

    (A) India’s rating is BBB+, which is the lowest investment grade rating

    (B) India’s long-term foreign and local-currency issuer default ratings were also fixed at ‘BBB-‘

    (C) The rating is mainly due to the weak state of the government’s finances.

    A Only (A) Correct Answer Incorrect Answer
    B Only (A) & (B) Correct Answer Incorrect Answer
    C Only (A) & (C) Correct Answer Incorrect Answer
    D Only (B) & (C) Correct Answer Incorrect Answer
    E All (A), (B) & (C) Correct Answer Incorrect Answer

    Solution

    India’s rating is BBB-, which is the lowest investment grade rating Fitch has acknowledged India’s strong growth and recent economic reforms, but it has a given a BBB- rating owing to the weak state of the government’s finances. According to Fitch, India’s general government debt burden was 67.9% of GDP whereas the ‘BBB’ median is 40.9%. 

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