"A fragmented coalition will be the biggest threat to the credit quality,"
"If a coalition of smaller, regional parties without a common economic reform agenda were to take the helm, it would likely provoke further capital flight, thereby increasing borrowing costs and weakening the Indian rupee, and delaying economic recovery."
Eleven Indian regional parties holding about a fifth of seats in the 545-member parliament last week formed a bloc to coordinate positions in the current session of parliament, a precursor to a possible coalition in elections due by May. Opinion polls show the opposition
"The increasing importance of regional parties will continue to hamper the efficacy of nationwide policy making, regardless of the political complexion of the eventual central government," Moody's Ghosh said.
The rupee, which has declined about 14 per cent in the past year, rose 0.1 per cent to 62.43 per dollar in
The regional parties are modeling themselves on the
A similar alliance took power in 1989. Neither of the so-called third-front governments survived a full five-year term.
We don't "believe that a strong showing by one of the major parties would, by itself, translate into an immediate improvement in
Finance Minister P.alaniappan Chidambaram has vowed to reduce the fiscal deficit to 4.8 per cent of GDP in the financial year ending
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