Strong external liquidity. Good growth prospects. Fiscal inflexibility, due to high debt and large deficits. Ineffective policy implementation. On April 19, 2006, Standard&Poor's Ratings Services revised its outlook on India to positive from stable. At the same time, Standard&Poor's affirmed its 'BB+' long-term and 'B' short-term sovereign credit ratings on India. The outlook revision reflects improved prospects of a stabilizing debt burden based on greater effort across all levels of governments to consolidate their fiscal positions. This effort on fiscal consolidation should start to address India's principal credit risks, which are generated by a weak fiscal profile, especially its high deficit and serious fiscal inflexibility. India's fiscal weakness is one of the worst among rated sovereigns,
