Control BJP members or risk losing credibility, Moody’s warning to Modi
New Delhi: Referring to
the “ethnic tensions” in the wake of controversies over beef and other issues,
Moody’s today said that Prime Minister Narendra Modi must keep BJP members in
check or risk losing “losing domestic and global credibility”.
Stating that BJP does
not have a majority in Rajya Sabha to pass crucial reforms and the Opposition
was being ‘obstructionist’, Moody’s Analytics said in a report that the
government has also not helped itself in recent times with controversial
comments from various BJP members.
“While Modi has largely
distanced himself from the nationalist jibes, the belligerent provocation of
various Indian minorities has raised ethnic tensions.
“Along with a possible
increase in violence, the government will face stiffer opposition in the upper
house as debate turns away from economic policy. Modi must keep his members in
check or risk losing domestic and global credibility,” the report said.
The comments from
Moody’s Analytics, the economic research and analysis division of Moody’s
Corporation, are the first by any major global institution over the recent
political controversies in India.
however, said “its commentary is independent and does not reflect the opinions
of Moody’s Investors Service Inc, the credit ratings agency which is also a
subsidiary of Moody’s Corporation”.
The report titled
‘India Outlook: Searching for Potential’ further said that the ongoing assembly
elections in Bihar could “prove pivotal to Modi’s leadership”.
“The BJP is not the
incumbent (in Bihar), so a win here would help secure an upper house majority…
Overall, it is unclear whether India can deliver the promised reforms and hit
its growth potential. Undoubtedly, numerous political outcomes will dictate the
extent of success,” it added.
India’s GDP growth for September quarter at 7.3 per cent, while for the full
fiscal it would be 7.6 per cent.
It, however, cautioned
that Indian equities have also suffered from a loss in domestic sentiments and
the failure to deliver on key reforms has faded the optimism.