Global rating agency S&P Global has upgraded India’s sovereign credit rating to BBB (investment grade) after 18 years. This means India is seen as having a good ability to repay its debts, though it may face some challenges in tough economic times.
The upgrade comes despite ongoing tariff tensions between the US and India. S&P also said that even if the US imposes 50% tariffs on Indian goods, the overall impact on India’s long-term growth will be small.
According to S&P, India is one of the best-performing economies in the world. Between 2022 and 2024, India’s GDP grew an average of 8.8%, the fastest in the Asia-Pacific region. For the next three years, the agency expects growth to average 6.8% per year, which will help keep the government’s debt under control, even though fiscal deficits remain high.
This move is expected to boost investor confidence and maintain foreign investment interest in India. The last time S&P upgraded India’s rating was in January 2007. Earlier this year, DBRS also upgraded India’s rating.
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The Finance Ministry said the upgrade proves that under Prime Minister Narendra Modi’s leadership, the Indian economy is agile, active, and resilient.
S&P added that India’s strong economic growth is improving its financial position and expects these healthy fundamentals to continue driving growth for the next two to three years.
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