Our Wall Street correspondent reports from New York that India is making waves in world finances again.
Moody’s is a bond credit rating agency. Depending on financial conditions prevailing in a country, Moody’s give ratings like Aaa, Aa1, Aa2 and so on till C. Current rating of India is Baa3, judged to have speculative elements and a significant credit risk.
However, due to recent political situation arising from India, Moody’s is forced to invent more grades. For example, starting October 2010, Indian market is suffering from strong policy paralysis. This has created a need for a new category Zzz for Beetle Bailey ratings. However, keeping deep diplomatic impact of such ratings, Moody’s have resisted announcing such a rating. However, if by the next election, ruling UPA coalition repeats, this grade is likely to be official. It will be projected to be a “character overflow from Aaa” to avoid any embarrassment to the government of India.
In year 2014, a new political party called AAP, an anti-corruption brigade, is likely to reach a leverage position in the powerful lower house of this one of the BRIC country. Things took a strange turn today and made Moody’s invent yet another rating. This AAP party today invited well-known green leader Medha Patkar for membership, which she has been positive to. If political circles of India are to be believed, well-known Booker prize winner and fire-brand intellectual Arundhati Roy may not be very far from joining AAP. AAP, which started its stand from economic center, is rapidly moving leftwards and its popularity is moving skywards.
This has sent strong signals to international investment community that India is keen on competing with the recent performance of Brazil markets. This has got gears whirring in Moody’s. Moody’s risk managers are debating while this is being written to invent a new possible category Eek. The debate in the closed meeting rooms of Moody’s is about whether to append an exclamation mark and make it “Eek!”.