SP views as credit negative the circumstances leading to resignation of Urjit Patel, analysts said.LONDON:The increasing involvement of the government in the affairs of the country's central bank is a negative for the ratings of giant Asian economy's banking system, SP Global said on Monday.
"SP Global Ratings views as credit negative the circumstances leading to the recent resignation of Urjit Patel, governor of the Reserve Bank of India (RBI)," SP analysts Michael Puli and Andrew Wood said in a note."Sustained and intense external pressure from the Indian government risks eroding these (central bank independence and prudent policy) settings over time, and could also undermine the long-term financial stability in the country."SP's lead global sovereign analyst said last week that the country's 7 per cent annual growth would be enough to keep the country's investment grade BBB- rating stable.