"India's budget pursues realistic fiscal consolidation, a credit positive for the sovereign", said Moody's in its credit outlook for the country.
Chidambaram in his Budget for 2013-14 proposed to bring down the fiscal deficit to 4.8 per cent of the Gross Domestic Product from 5.2 per cent in the revised estimates for the current financial year.
"This plan of modest fiscal consolidation is credit positive for the sovereign because, against a backdrop of subdued GDP growth and upcoming elections, it is a realistic effort to correct India's macroeconomic imbalances", the rating agency said.
Earlier, ratings agencies like Standard and Poor's and Fitch had threated to downgrade India's sovereign credit rating to junk grade in view of the worsening fiscal position of the government.
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