The Economic Survey 2020-21 highlights the issue of the adverse rating given by international credit rating agencies to emerging economies. Examine the basis used in the Economic Survey in support of the argument. Also, suggest on what basis India should make the argument against the rating given by the international credit rating agencies. 10 marks

Mentor’s comment-
  • https://www.livemint.com/opinion/quick-edit/economic-survey-india-s-unfair-credit-rating-11611922958312.html
  • In the intro, mention the importance of rating given by these credit rating agencies to attract investment.
  • In the body, discuss the basis of size used in the economic survey, next highlight the issue with using the size of the economy as the basis of creditworthiness. In suggestion mention India’s clean repayment record as an argument against adverse credit ratings.
  • Conclude by mentioning the need to tackle the issue by dialogue with these agencies.
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bhupender Kumar
3 years ago

order id GY9T8dRkR7Pfl

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Parth Verma
3 years ago
Reply to  bhupender Kumar

Hi Bhupender
Answer is well started.
Mention the issues with Credit Rating like-
-Rating agencies rarely get credit quality right and they have been found to be well behind the curve in almost every default crisis.
-The behavior of these agencies has been pro-cyclical, which is often seen to aggravate crises and fuel bubbles.
Some good points but need to work on content.
Good conclusion.

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