Japanese credit rating agency Rating and Investment Information, Inc. (R&I) has upgraded India’s long-term sovereign credit rating to ‘BBB+’ from ‘BBB’, while retaining the “stable” outlook for the Indian economy.
This is the third such upgrade by a sovereign credit rating agency this year, following S&P’s upgrade to ‘BBB’ (from BBB-) in August and Morningstar DBRS’ upgrade to ‘BBB’ (from BBB (low)) in May, reaffirming India’s position as one of the most dynamic and resilient major economies in the world.
As per R&I’s India sovereign rating review published on Friday, the upgrade is supported by India’s position as one of the world’s largest and fastest-growing economies, underpinned by its demographic dividend, robust domestic demand, and sound government policies.
R&I in its report recognises the progress in fiscal consolidation by the government, driven by buoyant tax revenues and rationalisation of subsidies, and manageable level of debt along with high growth. It also highlights India’s strengthened external stability, reflected in modest current account deficit, stable surpluses in services and remittances, low external debt-to-GDP ratio, and sufficient forex cover.
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