Expressing surprise over S&P's threat to downgrade India's credit rating, industry bodies on Friday termed the global agency's affirming its negative outlook on the country as unfortunate and harsh.
Standard & Poor's (S&P) has warned that it may downgrade India's sovereign rating to junk grade if the government fails to pursue reforms and check deterioration in fiscal and CAD.
"S&P's warning of downgrading India to junk status has come as a surprise. At this juncture when signs of improvement are on the horizon, there is a high likeliness that the problems would soon be tackled," industry chamber Ficci said.
It said the set of macro data released recently gives clear indications of return in buoyancy in the economy.
Another leading chamber CII said the negative outlook affirmation by S&P for India's BBB-status is "unfortunate".
While retaining India's sovereign rating at 'BBB-' with a negative outlook, S&P said there is at least a one-in-three likelihood of a downgrade within the next 12 months.
CII said that over the last eight months a number of measures have been taken by the government through the Parliamentary system and also through notifications, which have clear directional value in terms of reforms.
"In the light of that, the rating by S&P appears to be harsh on India," it added.
CII said the chamber is confident that the government would do everything necessary to bring current account deficit and fiscal deficit under control.
Meanwhile, Ficci also said that moving on a higher growth path remains the central agenda of the government and the aspiration to realise this looks strong.