In a timely endorsement to the Narendra Modi government’s economic policy, global ratings major S&P has upgraded the country’s investment outlook from stable to positive. An upgraded outlook would mean higher inflow of foreign investment which, in turn, will mean cheaper funds for the country’s economic development.
The American rating organisation credited the country’s robust economic expansion and sound economic fundamentals for its decision to revise its outlook. It particularly spoke in praise of the Modi government’s focus on increasing its investments in infrastructure, its efforts to gradually reduce fiscal deficit and its attempt to keep inflation subdued.
Though this announcement had come just two days ahead of the last leg of crucial Indian elections, the rating agency tried to not influence voting patterns in the country as it stated that it expects broad continuity in economic reforms and fiscal policies, regardless of the election outcome.
With the Indian election veering towards unprecedented populism, S&P also has a word of caution for the country’s political parties. It said that it “could revise the outlook to stable if it observed an erosion of political commitment to maintain sustainable public finances which, in turn, signifies a weakening of the country's institutional capacity”.
Regardless of the election result, the country’s economy is the collective responsibility of all political parties. People earnestly hope that they do not kill the goose that lays golden eggs in their greed for political power. While widening income inequality is not in the best interests of the country, the principles of Robin Hood don’t serve well either the cause of the long-term good of the country. India and its economy need a balanced approach for the overall holistic development of the entire society — and not at the expense of one another. After the election results, it is hoped that the political leadership behaves responsibly in the supreme interest of the country and its people.
