New Delhi, May 9 (IANS) India’s rating has been upgraded from ‘BBB (low)’ to ‘BBB’ with a ‘Stable’ trend by global sovereign credit rating agency Morningstar DBRS.
The key drivers for the ratings upgrade include India’s structural reforms through infrastructure investments, digitalisation, fiscal consolidation, sustained high growth with macroeconomic stability, and a resilient banking system.
“The global sovereign credit rating agency, Morningstar DBRS, upgraded India’s Long-Term Foreign and Local Currency – Issuer Ratings from BBB (low) to BBB with a Stable trend,” a Finance Ministry statement issued on Friday said.
“India’s Short-Term Foreign and Local Currency Issuer Ratings were also upgraded to R-2 (high) from R-2 (middle) with a Stable trend,” the statement said.
The upgrade is based on India’s structural reforms, which entail massive investments in infrastructure to spur growth and create employment and digitalisation, which facilitated fiscal consolidation reflected in declining debt and fiscal deficit levels and sustained high growth. India has clocked an average GDP growth of 8.2 per cent during FY22-25, with macroeconomic stability as inflation has come down, the exchange rate of the rupee is range-bound, and the country’s external balance is sound.
A resilient banking system featuring well-capitalised banks with a high capital adequacy ratio and a decline in non-performing loans to a 13-year low was another significant driver for the upgrade.
The credit rating may be further upgraded if India continues to implement reforms that raise the investment rate, enhancing medium-term growth prospects. The report also stated that despite the current public debt levels, risks to debt sustainability are limited due to local currency denomination and long maturity structures. Further, continued reforms and a reduction in the public debt-to-GDP ratio could bring further upgrades, the statement said.
The rating scale for Morningstar DBRS is similar to the Fitch and S&P rating scales. Morningstar DBRS uses ‘high’ and ‘low’ as suffixes compared to the +/- nomenclature used by Fitch and S&P.
–IANS
sps/vd
Disclaimer
The information contained in this website is for general information purposes only. The information is provided by BhaskarLive.in and while we endeavour to keep the information up to date and correct, we make no representations or warranties of any kind, express or implied, about the completeness, accuracy, reliability, suitability or availability with respect to the website or the information, products, services, or related graphics contained on the website for any purpose. Any reliance you place on such information is therefore strictly at your own risk.
In no event will we be liable for any loss or damage including without limitation, indirect or consequential loss or damage, or any loss or damage whatsoever arising from loss of data or profits arising out of, or in connection with, the use of this website.
Through this website you are able to link to other websites which are not under the control of BhaskarLive.in We have no control over the nature, content and availability of those sites. The inclusion of any links does not necessarily imply a recommendation or endorse the views expressed within them.
Every effort is made to keep the website up and running smoothly. However, BhaskarLive.in takes no responsibility for, and will not be liable for, the website being temporarily unavailable due to technical issues beyond our control.
For any legal details or query please visit original source link given with news or click on Go to Source.
Our translation service aims to offer the most accurate translation possible and we rarely experience any issues with news post. However, as the translation is carried out by third part tool there is a possibility for error to cause the occasional inaccuracy. We therefore require you to accept this disclaimer before confirming any translation news with us.
If you are not willing to accept this disclaimer then we recommend reading news post in its original language.
