Is India heading towards the end of its much-touted growth story? A report by global credit rating agency Standard and Poor’s (S&P) released on June 11 seems to suggest so. Titled “Will India be the first BRIC fallen angel,” the report cautions that India may become the first so-called “BRIC” (Brazil, Russia, India and China) country to lose its investment grade rating.

S&P’s newest warning spooked the markets — the stock market went down and so did the rupee (although they did recover the following day) — but the government seems unfazed. In a statement, Finance Minister Pranab Mukherjee said: “Between April 2012 and now, there are no significant events to indicate that the economy’s vulnerability to shocks has increased, though growth numbers for the fourth quarter [of] 2011-2012 have come below expectations.” Barely a few hours before the S&P report was released, while addressing a function in New Delhi, Mukherjee had said: “I do not accept the prophecies of self-styled Cassandras that GDP growth will go down.”

How much of this is bravado — and what measures the government will take to get back on track — will be clear in the coming weeks and months. For now, there is not much to cheer about. India’s GDP growth for the January–March quarter at 5.3% was the lowest in nine years. For the year 2012-2013, growth estimates now are at around 6% — way below the 7.6% the government had projected at the beginning of the year. The country is also facing fiscal and current account deficits.