Finance minister Pranab Mukherjee said there was “no need for panic” after the rating agency Standard & Poor’s downgraded the country’s outlook from stable to negative on Wednesday.

India is likely to pass some financial reforms in the current session of Parliament, which started on Monday, he added.

“There is no need for panic,” Mukherjee told reporters.

“The situation may be difficult, but we will be surely able to overcome (it),” he said.

S&P revises India economic outlook to negative

Global rating agency Standard & Poor’s (S&P) has revised its outlook on India’s long-term rating to negative from stable.

The Sensex crashed around 150 points close on the heels of the announcement of S&P ratings.

The agency cited a slowdown in investment and economic growth and a widening in the current account deficit as the reason for negative rating of the world’s largest democracy.

It affirmed BBB- rating for India and warned that the country stands one out of three chance of a downgrade if external positions worsen.

The negative outlook signals at least a one-in-three likelihood of the downgrade of India’s sovereign ratings within the next two years, S&P said.