The ratings agency currently rates India at Baa3
Moody's Investors Service could consider upgrading India's sovereign rating if the government's planned fiscal consolidation is faster than its expectations, Marie Diron, a senior vice president at the agency's Sovereign Risk Group told Reuters on Thursday.
However, if the government slowed its fiscal consolidation plans or faltered on its reform implementation, the ratings agency would stabilise the rating at the current "Baa3," Diron said.
"What would potentially trigger an upgrade would be a faster progress in fiscal consolidation than we are currently expecting," Diron said in a telephone interview from Singapore.
The ratings agency currently rates India at "Baa3", the lowest investment grade rating, with a "positive" outlook.
Diron added Moody's was focussing on the credibility and effectiveness of the country's monetary policy framework more than on who the central bank governor was when asked about the re-appointment of Reserve Bank of India governor Raghuram Rajan to a second term.
Photograph: Amit Dave/Reuters