Asia's third-largest economy is battling high prices, a weak fiscal position and slower growth on the domestic front, while uncertainty in global financial markets and Europe's sovereign debt problems are adding pressure. "The negative factors, combined with the government's weak policy formulation and implementation, may lead us to a tipping point," warned S&P credit analyst Takahira Ogawa. India's economic reform process has been paralysed by a string of political scandals that has taken the sheen off Prime Minister Manmohan Singh's Congress-led government. India's economy has also slowed under the brunt of 13 interest rate rises since March 2010 as the central bank sought to tame inflation from near double-digits to its current two-year low of 7.47 percent. "The balance of risk factors for the sovereign credit rating may be shifting slightly toward the negative," the ratings agency said in a report. S&P said it did not expect to downgrade or revise its "stable" outlook on its investment grade "BBB-" long-term sovereign credit rating on India in the near future. But the government's ability to implement measures to improve economic growth and rein in its fiscal deficit would be vital to boost investor confidence, Ogawa said. "Our stable outlook on the 'BBB-' long-term rating on India currently reflects our expectation of strong economic growth in the medium term and gradually improving fiscal performances," Ogawa said. India's "BBB-" rating is considered investment grade and is one notch above "junk," which carries a higher risk of default. S&P in 2007 hiked India's credit rating to investment-grade, a move that paved the way for global funds to invest in government bonds and other debt in the country. A higher credit rating makes it cheaper to borrow money. India's economy is forecast to expand by around seven percent this fiscal year to March 31, down from 8.4 percent last year, while its fiscal deficit is expected to be higher than its planned 4.6 percent of gross domestic product due to ballooning subsidy programs targeting the nation's poor millions.