NEW DELHI: Even as it affirmed the country's credit rating at BBB-/A-3, global rating agency Standard & Poor's on Thursday warned of a likely downgrade in 2014 if the new government fails to reverse India's low growth."We have noted a marked slowdown in India's real growth . This complicates the government's debt dynamics and ability to implement reforms," S&P said. "We will review India's rating after the next general election," S&P said."The outlook remains negative, indicating that we may lower the rating to speculative grade next year if the government that takes office after the general election does not appear capable of reversing India's low economic growth," the agency added."The vibrancy of India's democracy will again come to the fore in general elections, which are due no later than May 2014. Power has alternated between the Congress Party and the BJP Party since 1998. The next government, regardless of its composition, will face several challenges," S&P said.The current investment-grade ratings are supported by institutional strengths and foreign exchange reserves , the agency said. "These strengths are counterbalanced by significant weaknesses, which include an onerous burden from its public finance , lack of progress on structural reforms, and shortfalls in basic services typical of a nation with a GDP per capita of $1,500," the agency said.S&P feels that achieving the government's own fiscal deficit target of 4.8% of GDP in fiscal 2014 will depend partly on the government's resolve on the level of election spending and on the evolution of commodity prices. "The central government's budget balance, however, tells only part of the Indian fiscal story. Using a broader measure of general government deficits, we project a 7.2% of GDP deficit for fiscal 2014, to which one should add 1-2 percentage points of GDP deficits for the unprofitable portions of the consolidated public sector, including state electricity boards and oil-marketing companies," it added."The Indian government has sent mixed signals on subsidy policies. On the positive side, the government has decided to deregulate domestic diesel prices and state-owned oil companies are increasing their domestic prices in steps. The government had planned to phase out diesel subsidies (its single most costly subsidy) by year-end," it said."However, global oil prices that are higher than what the government was expecting in its plans and the depreciation of the rupee against the dollar will delay the phasing-out of diesel subsidies. On the negative side, the government has secured parliamentary approval to expand coverage of food subsidies to almost two-thirds of India's households. This act could almost double the size of the government's food subsidy in future budgets to about 1.5% of GDP," it added.