The Strategist

S&P upgrades India's 'BBB-' rating outlook to 'positive'

05/30/2024 - 09:42

International rating agency S&P Global Ratings confirmed India's long-term foreign and local currency credit ratings at 'BBB-'. The ratings outlook was previously "stable," but it is now "positive."

McKay Savage
McKay Savage
"India's credit profile is improved by its strong economic growth. We anticipate that the nation's solid economic foundation will continue to grow over the next two to three years," the agency stated in a press release.

S&P analysts forecast that India would maintain its current fiscal policies and pursue further economic reforms regardless of the outcome of the nation's June 2024 general elections. They also point out that the proportion of public spending on infrastructure is rising and that the structure of public spending in India has changed. This is anticipated to boost the nation's economy.

According to the statement, "the Indian government is prioritizing ongoing spending consolidation measures, despite high fiscal deficits, high debt levels, and interest cost burdens."

The experts believe that "stable policies, more extensive economic reforms, and significant infrastructure investments will support sustained growth in the country's economy," which is reflected in the positive prognosis for India's ratings.