World famous investor Mark Mobius has warned that India is facing a possibility of sovereign downgrade by global rating agencies.

Mobius, the head of Templeton Asset Management, said a in recent television interview that a sovereign downgrade for the Indian economy is a possibility as the government's measures to correct markets are doing little to enhance sentiment.

The Sensex recently suffered a loss of 769 points to 18,598, while the Nifty slipped 234 points to 5,507 as worried foreign investors withdrew nearly Rs 563 crore from the markets. Since the start of this year, the Sensex and Nifty have lost 4.26 per cent and 6.73 per cent, respectively.

The rupee slipped to its record low of more than 62 per US dollar before finishing at 61.71 per dollar on Friday. The Indian currency has lost more than 12 per cent against the dollar so far this year, which made it the worst-performing currency in Asia.

India's VIX, which is used to measure businesses' expectations of volatility, hit it's more than a year high of 23.64. Yield on the ten-year government bonds jumped to 8.85 per cent, the highest level in nearly two years. The increasing bond yields are indicating higher interest rates for already struggling companies as well as consumers.

Global rating agency Moody's on Friday slapped India's three government-run firms citing high rate of inflation and worsening macro-economic conditions.