India's ratings reflect Fed tapering fears: Fitch

India's narrowing current account deficit will not be enough to shield the country from pressures tied to Fed tapering, said Fitch Ratings.

However, Fitch added the spillover effects of the Indian rupee's weakness have not significantly hurt India's creditworthiness and will therefore not trigger any ratings action at this point.

"(India's ratings) already incorporate both the sovereign's vulnerabilities and tolerance for volatility in global financial market conditions," Fitch said.

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Fitch added India's economy has "not lost much momentum" on the back of "resilient" agriculture and exports, and predicts economic growth of 4.8 percent in 2013/14 and 5.8 percent in 2014/15.

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Fitch also noted India's fiscal deficit remains under pressure, especially ahead of the general elections due next year, but says the government is likely to come down heavily on spending.

Fitch rates India at "BBB-minus", the lowest investment grade rating. It revised its outlook for the country to "stable" from "negative" in June.

Reuters