MUMBAI May 16 The fiscal and economic reforms
taken by India's new government in the next two to three months
will have "significant implications" on India's sovereign credit
rating, Standard & Poor's Ratings Services said on Friday.
S&P added the next government would need to regain "fiscal
prudence in a sustainable way," such as by implementing a goods
and services tax to help stabilise government revenues.
"What the next government says and does in the coming months
is crucial to boosting confidence in the policy settings and the
economy," S&P credit analyst Takahira Ogawa was quoted as saying
in the statement.
"If confidence rises, investment and consumption in India
could strengthen, after being held back by the uncertainty
surrounding the election."
The S&P statement came after the Bharatiya Janata Party and
its allies were headed for the biggest victory the country has
seen in 30 years.
S&P is the only of the three major credit agencies to have
India with a "negative outlook" for its "BBB-minus" rating,
meaning any downgrade would send the country to below investment
(Reporting by Suvashree Dey Choudhury; Editing by Rafael Nam)