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Commenting on the S&P's stand on the likely downgrade of India to 'junk' status, Mr C Rangarajan chairman of PMEAC told that the rating agency was misinformed.

Stating that their fears were misplaced, Mr Rangarajan said that he did not see a further deceleration in the economy's growth rate.

On the contrary he expressed faith that the economy will grow at a better rate in the current fiscal as compared to the last. He also opined that the inflation rate will come down in the current fiscal.

Based on the assumption that a normal monsoon will enhance agricultural production and that the global economic situation will not deteriorate further, Mr Rangarajan said that the economy will likely grow at 6.5% to 7% this year.

With the global economy on tenterhooks, Mr Rangarajan emphasised the need to contain the Balance of Payments deficit 'within reasonable limits'.

Standard & Poor's said on Monday that India could become the first of the BRIC economies to lose its investment-grade status, sending the rupee and stocks lower, less than two months after cutting its rating outlook for the country. The ratings agency said that "Slowing GDP growth and political roadblocks to economic policymaking are just some of the factors pushing up the risk that India could lose its investment-grade rating.”