S&P's negative outlook for India indicates that it may lower the rating to speculative grade next year if the government that takes office after the general election does not appear capable of reversing the country's low economic growth
Ratings agency Standard & Poor's (S&P) affirmed the 'BBB-' long-term and 'A-3' short-term unsolicited sovereign credit ratings on India with a negative outlook.
According to the ratings agency, the vibrancy of India's democracy will again come to the fore in general elections, which are due no later than May 2014. It said, "Power has alternated between the Congress Party and the BJP since 1998. The next government, regardless of its composition, will face several challenges. The 13th Finance Commission has recommended a central government fiscal deficit target of 4.2% of GDP in the fiscal year ended March 2013. Although the current Congress administration tried to close the gap to this target, it did so by having one-off measures such as compressing unspent budget allocations and selling minority stakes of nonfinancial public enterprises to public sector financial enterprises."
"The new government will face difficult tasks to place its fiscal accounts on a firmer footing: phasing out of diesel subsidies, financing the expansion of food subsidies, addressing other subsidies such as those for fertilizer, and introducing the nationwide rollout of a common goods and services tax," the ratings agency added.
According to Barclays, this commentary (by S&P) is marginally positive, with the ratings agency almost ruling out a downgrade before the national elections, which are due in May 2014 and even though the negative outlook is maintained, S&P has effectively given the next government a window to usher in economic reforms. "Based on our discussions with market participants, most appear to be taking into account a small but non-negligible possibility of a ratings downgrade in the coming months, and high grade benchmarked portfolios had less-than-benchmark exposure to the country’s bonds. Given that the next rating update could well be at least nine months away, maintaining an underweight position would be expensive. As a result, we expect S&P’s update to prompt some buying that could push spreads 15-20 basis points (bp) tighter versus benchmark," it said in a note.
In a release, S&P said, its rating affirmation rests in several key strengths of India. "These include a robust participatory democracy of more than 1 billion people and a free press; low external debt and ample foreign exchange reserves; and an increasingly credible monetary policy with a largely freely floating exchange rate," it said.
"These strengths are counterbalanced by significant weaknesses, which include an onerous burden from its public finance, lack of progress on structural reforms, and shortfalls in basic services typical of a nation with a GDP per capita of $1,500. Real per capita growth had averaged more than 6% annually for fiscal year 2004-2011 (ended March 2011), and had eased India's fiscal constraints and poverty levels. But growth has slowed steadily since then to half that level, fraying the social contract and putting at risk the declining trend in government debt," the ratings agency added.
UP government has provided security cover to 830 people beyond the authorised list. In fact 170 of them had been give security free of cost!
The Lucknow bench of the Allahabad High Court while hearing a public interest litigation (PIL) has asked the Uttar Pradesh (UP) government to remove unauthorised security cover provided to 830 people and recover the cost from these people within next 15 days.
Social activist Dr Nutan Thakur had filed the PIL. The affidavit signed by Ajay Kumar Singh, DSP, of Security Wing in UP before the HC states, "currently 830 persons beyond the authorised list have been awarded security by the UP Government. Out of these unauthorised persons, 170 have been awarded security free of cost while 650 have been awarded security on payment."
Displaying its displeasure over grant of security personnel to unauthorised persons, the Bench of Justice Imtiyaz Murtaza and Justice Devendra Kumar Upadhyaya asked the state government about the money that was not recovered. While directing the UP government to recover the money in 15 days, the High Court said in case the recovery is not made, the senior superintendent of police (SSP) or SP will be held liable for the same.
As per the affidavit, the total expenditure on these persons beyond authorised list comes at Rs4.83 crore. Of this Rs3 crore has been recovered while Rs1.83 crore still needs to be recovered.
The affidavit also mentions names of several persons who have been granted security even without any recommendation from the district security committee (DSC). The HC also directed the state government to immediately withdraw security provided without the recommendation of DSC.
While Dr Thakur has been asked to file her rejoinder reply, the state government has been directed to file reply under signature of the Principal Secretary (Home). The next date of hearing has been fixed on 2 December 2013.
The CIC directed PIO of Food Supplies and Consumer Affairs department at GNCTD to publish details of application for ration cards suo moto on their website. This is the 189th in a series of important judgements given by former Central Information Commissioner Shailesh Gandhi that can be used or quoted in an RTI application
The Central Information Commission (CIC), while allowing an appeal, directed the Public Information Officer (PIO) and assistant commissioner at Food Supplies and Consumer Affair department at Government of National Capital Territory of Delhi (GNCTD), to publish details of application for ration cards suo moto under Section 4 of the Right to Information (RTI) Act.
While giving the judgement on 6 July 2009, Shailesh Gandhi, the then Central Information Commissioner said, "The public authority has failed in its duty to provide such information. The public authority must provide details of application for ration cards suo moto under Section 4 and if any of the applications are refused, these must also be declared on its website. Reasons for refusal must also be displayed."
Delhi resident, Ripu Sudan, on 6 March 2009, sought from the PIO information regarding the status of his ration card application. Here is the information he sought and the reply provided by the PIO...
1. In how many days will Appellant's Ration Card be made?
PIO's Reply- It is not concerned with Division.
2. Why is it taking so long time?
PIO's Reply- It will be informed after making.
3. Will compensation be provided to the Appellant for harassment?
PIO's Reply- Nothing
Not satisfied with the PIO's reply, Sudan, the applicant filed his first appeal. However, there was no mention of any order by the First Appellate Authority (FAA).
Sudan then approached the CIC with his second appeal.
During the hearing, Mr Gandhi, the then CIC, noted that Sudan, the appellant had applied for renewal of his ration card in 2007. He had surrendered the old card on 29 May 2007 but has not received any reply from the public authority. He has therefore, asked about the fate of his application, which has not been provided, the Bench observed.
While allowing the appeal, the Bench directed the PIO to "provide the reasons for the delay to the appellant before 20 July 2009". "The PIO will also ensure that the names of those who apply for ration card, dates on which they apply and dates on which ration cards are given should be put up on the websites of the public authority under Section 4 of the RTI Act, 2005. If any applications are rejected, this should also be put up with reasons for rejection. The PIO will ensure that this is done by the public authority before 15th August 2009," the Bench said.
CENTRAL INFORMATION COMMISSION
Decision No. CIC/SG/A/2009/001215/3997
Appeal No. CIC/SG/A/2009/001215
Appellant : Ripu Sudan
Respondent : AK Singh,
Office of the Assistant commissioner, N/W District, Food Supplies & Consumer Affairs,
GNCT of Delhi, CSC, CC Block,
Shalimar Bagh, Delhi-110 088