World Bank chief economist Kaushik Basu has said that the India is not a prime target for downgrading the economic rating as the government has started implementing key reforms in Asia's third largest economy.

He said that it would a mistake if the rating agencies downgrade the country as reforms are being implemented in the country. Standard & Poor's has said that there is `1 in 3 likelihood' of a downgrade for the country during the coming 24 month period. S&P had downgraded India's sovereign outlook to "negative", warning that the country's rating of "BBB-" might be further downgraded. The rating of BBB- is the agency's lowest investment-grade rating.

"Now that I study countries across the board, India is by no means a prime candidate for downgrading in terms of ratings, as especially with reforms now in the picture. If I were in-charge of a rating agency, I would clearly not put India in a category where you begin to worry," said Basu. He was speaking at the Delhi Economics Conclave.

The agency believes that the Indian economy is facing difficulties due to low rainfall in the country as well as international factors like continuing debt crisis in the Eurozone and a slow recovery in the US. The Indian government is taking steps to improve the situation and had increased the price of diesel to reduce its deficit.