Congress terms Standard and Poor report erroneous

New Delhi, June 12 (ANI): Congress Party on Tuesday termed the global agency Standard and Poor's threat to downgrade India's credit rating, citing division of roles between Sonia Gandhi and 'unelected' Manmohan Singh, to be completely erroneous thereby betraying a complete lack of understanding of both India's political and governance system.

Congress spokesperson Manish Tiwari said the Standard and Poor's report betrays a very poor appreciation of India's democratic system and governance processes.

"As I was earlier pointing out, the same report on page four says that 'the Indian economy grew at 8.8 percent between 2004-08 and at 7.8 percent between 2009-11', though of course the growth figures were higher. Now, during this entire period, was Mrs. Sonia Gandhi not the chairperson of the United Progressive Alliance (UPA)? Was Dr. Manmohan Singh not the Prime Minister of India?" asked Tiwari.

"So therefore, if at all there is a disconnect, then why did this disconnect not manifest itself earlier. The fact remains that Standard and Poor's is one other credit rating agency. It might have an opinion, but neither is it gossiple and nor is it caste in stone," he added.

Asserting that the fundamentals of the Indian economy are strong, Tiwari said : "Yes, there is a global economic situation in which there has been a slowdown across the major economies of the world. If you look at the Purchase Managers Index numbers for industrial output, which came in earlier this month with regard to China, South Korea, Indonesia, Australia, United States of America and not to mention the Euro zone. There has been a general slowdown in the economy."

"Yes, we are impacted with that. But you know to extrapolate and say that there is a political disconnect, which is holding up the pace of economic growth. I would respectfully submit is completely erroneous and betrays a complete lack of understanding of both India's political and governance system," he added.

The S and P in its report said that the crux of the current political problem for economic liberalisation is the nature of leadership within the central government and not 'obstreperous' allies or an 'unhelpful' opposition.

"Slowing GDP growth and political roadblocks to economic policy making could put India at risk of losing its investment grade rating", the S and P said in its report-'Will India Be The First BRIC Fallen Angel?'

Standard and Poor's, which had lowered India's rating outlook to 'negative' from 'stable' in April, said the Congress party is divided on economic policies and there is substantial opposition within the party to any serious liberalisation of the economy.

he S and P report said, 'paramount political power rests with the leader of the Congress party, Sonia Gandhi, who holds no Cabinet position, while the government is led by an unelected Prime Minister Manmohan Singh, who lacks a political base of his own'.

It said the division of roles between 'a political powerful' Congress President and an 'appointed' Prime Minister 'has weakened the framework for making policy, in our view'.

Citing economic slowdown and political roadblocks to policy-making, rating agency S and P today warned India could become the first BRIC nation to lose investment-grade rating. (ANI)