Fitch Ratings on Monday changed its outlook on India's credit to negative from stable.

The global ratings agency maintained a 'BBB-'rating, lowest investment grade, for the nation's long-term foreign and local currency Issuer Default Ratings and gave an F3 for short-term foreign currency.

The revised outlook comes following Standard & Poor's latest downgrade of India's sovereign credit outlook to negative. The outlook report published in April also laid warning that India may risk losing its investment grade status and leave the BRIC league unless the government tackles growth issues and weak implementation of policies across the nation.

Fitch said that further weakening of fiscal policy reforms would expand the gross general government debt/GDP ratio, thereby leading to a lowered sovereign rating for India. Moreover, high inflationary pressure coupled with Fitch's downward revision of the medium-term growth potential will have a negative impact on the nation's sovereign creditworthiness.

"Against the backdrop of persistent inflation pressures and weak public finances, there is an even greater onus on effective government policies and reforms that would ensure India can navigate the turbulent global economic and financial environment and underpin confidence in the long-run growth potential of the Indian economy," Art Woo, Director in Fitch's Asia-Pacific Sovereign Ratings group, said in the press release.

Fitch also projected that India's GDP growth would slow down to 6.5 percent for 2012-13 from a previous forecast of 7.5 percent for the same period. Wholesale price index is projected to rise to 7.5 percent for the current financial year, down from 8.8 percent recorded the previous year.

 Additional support for infrastructure investment along with a drastic fall in inflation levels will ease the ratings downgrade, the rating agency said. Fitch also recommended the government to adopt fiscal consolidation and structural budget reforms that will support higher sovereign ratings.

Meanwhile, Finance Minister Pranab Mukherjee said that the firm didn't take into account structural economic reforms adopted by the government. "The concerns expressed by Fitch on the economic growth potential, inflationary pressures, and weak public finances are based on earlier data. Government has already taken note of such concerns," Mukherjee said, according to Reuters.