Standard & Poor (credit agency) said today that India stood a real chance of becoming the first BRIC nation to lose its investment grade status, which would send the rupee and stocks even lower than they already are. The BRIC nations are a group of countries that have experienced rapid growth over the past few decades, Brazil, Russia, India and China. As of recently, South Korea was added to original lineup to make the group the BRICK nations.
There are several reasons why India could have their investment grade status lowered. The main ones are slowing GDP, political strife and economic policy making that are affecting the S&P’s decision. India’s March quarter GDP numbers showed growth of only 5.3% which is below expectations and the lowest in nine years. Out of all of the original BRIC nations, India has the lowest rating from S&P and is the only one to have a “negative” outlook.