New York City-based Moody’s Investors Service‘s upgrading India’s sovereign credit rating for the first time since 2004 to Baa2 from Baa3, and changing the outlook to ‘stable’ from ‘positive’, is a boost to the Modi government’s reform agenda.
Bloomberg says that the upgrade adds to a string of good news for Modi. The World Bank said it’s getting easier to do business in India, with Asia’s third-largest economy jumping 30 places to rank 100th in the latest ranking released last month. Earlier this week, Pew Research Center said Modi remained a popular leader and public confidence in the economy and the overall direction had improved.
- India is the largest economy among all Baa2-rated sovereigns
- The Philippines is the only other Baa2-rated country in Asia
- India ahead of other BRICS — Russia-Ba1, South Africa-Baa3, Brazil-Ba2
- Among BRICS, only India, China and South Africa are investment grade
- On a PPP basis, India’s GDP per capita has outstripped the Baa-rated median (19 countries)
- Between 2006 and 2016, this grew 108% vs. 74% for Baa-rated median
Moody’s forecasts GDP growth of 6.7 percent for the fiscal year through March 2018, with a pick up to 7.5 percent in the following year and “similarly robust” levels from 2019 onward — that’s in line with the median 6.8 percent and 7.4 percent estimates in a Bloomberg survey.
Last updated: December 26th, 2025
