Ratings agency Fitch IBCA has downgraded the rating for Russian debt, blaming serious concerns over the government's ability to restore order to public finances.

The London based agency cut Russia's sovereign debt rating, which is a reflection of confidence in ability to honour hard currency borrowing, from BB to BB minus.

Senior IBCA analyst, David Riley said: "It is not a reaction to what has been happening in the market over the last few days, but as a result of us looking at the numbers.

"It takes a big leap of faith to believe that they will be able to deliver on the economic programme.

"It is a substantial fiscal adjustment which would be difficult in the best of circumstances."

Prime Minister Sergei Kiriyenko is trying to rein in burgeoning debt and restor confidence to financial markets.

The emergency package of measures must be implemented to secure payment of a two year $22.6bn bailout package spearheaded by the IMF.

Despite the approval of fresh aid, Russian markets have languished near two-year lows in recent days.

Growing concern

The agency said that one of the main reasons for the dowgrade was the rejection of much of the austerity package by the State Duma or lower house of parliament.

There was also concern that a key element of the plan involved boosting tax revenues by tackling chronic non-payments issue.

Mr Riley added: "To get a substantial increase in tax revenues, they have to tackle the issue of non-payment which means whole chunks of the corporate sector.

"Much of this is bust already and has been for a long time, but has been kept alive through the system fo non-payment."

The ratings downgrade follows a similar move by both Moody's and Standard and Poor's, the two giants of international credit ratings.

It also brings Russia down to a level equivalent to that of Argentina and Romania, with just a few countries with a single B rating such as Pakistan and Turkey figuring lower in world rankings.

Mr Riley said Russia's rating would almost certainly be lower were it not for strong international support behind Moscow's reform efforts.