INDIA RATING UPGRADED BY S&P

India rating upgraded by S&P on August 14, 2025, as the agency raised the nation’s long-term sovereign credit rating to ‘BBB’ with a stable outlook. 
INDIA  UPGRADED BY Standard & Poor

15.08. 2025 : India has a great news to celebrate its Independence day . On August 14, 2025, S&P upgraded India’s long-term sovereign credit rating to ‘BBB’ from ‘BBB-‘, with a stable outlook. This is the first time S&P has upgraded India’s rating in 18 years.. The previous upgrade was in January 2007, when India was raised to ‘BBB-‘ (the lowest investment grade) from ‘BB+’.

The upgrade was based on several factors, including:

• Robust Economic Growth: S&P noted India’s strong economic performance, with real GDP growth averaging 8.8% from fiscal year 2022 to 2024, the highest in the Asia-Pacific region.
• Fiscal Consolidation: The agency highlighted the government’s commitment to fiscal consolidation and its efforts to improve the quality of public spending, particularly on infrastructure.
• Improved Monetary Policy: S&P recognized that India’s monetary policy framework has become more effective in managing inflationary expectations.
• Economic Resilience: The rating agency stated that India’s economy is resilient and its sound economic fundamentals are expected to support growth momentum over the next two to three years, even amidst global uncertainties and trade challenges.

S&P ratings scale  :  

S&P Global Ratings uses a letter-based scale to assess the creditworthiness of borrowers, including countries (sovereign ratings) and corporations. The ratings range from the highest quality, “investment grade,” to the lowest quality, “speculative grade” or “non-investment grade,” which indicates a higher risk of default.

The India rating upgraded by S&P marks the first upgrade in 18 years.

With the India rating upgraded by S&P, experts believe borrowing costs could reduce.

The India rating upgraded by S&P is expected to boost investor confidence.

Here’s a breakdown of the S&P ratings scale, from highest to lowest:

Investment Grade

• AAA: The highest possible rating, indicating an extremely strong capacity to meet financial commitments.
• AA: A very strong capacity to meet financial commitments. It differs from AAA only by a small degree.
• A: A strong capacity to meet financial commitments, but somewhat more susceptible to adverse economic conditions.
• BBB: An adequate capacity to meet financial commitments. However, adverse economic conditions or changing circumstances are more likely to weaken the borrower’s capacity.

Speculative Grade (or Non-Investment Grade)

• BB: Less vulnerable in the near term than lower-rated entities, but faces major ongoing uncertainties.
• B: More vulnerable to adverse economic conditions, but currently has the capacity to meet its financial commitments.
• CCC: Currently vulnerable and dependent on favorable business, financial, and economic conditions to meet financial commitments.
• CC: Highly vulnerable, with a default expected to be a virtual certainty.
• C: Currently highly vulnerable to non-payment.
• D: Default on a financial commitment has occurred.

Modifiers

S&P also uses plus (+) and minus (-) modifiers to indicate a relative standing within the rating categories from ‘AA’ to ‘CCC’. For example, ‘BBB+’ is one notch above ‘BBB’, and ‘BBB-‘ is one notch below.

Outlook

In addition to the rating itself, S&P assigns an “outlook” to indicate the potential direction of a long-term rating over the next six months to two years. The outlooks are:

• Positive: A rating may be raised.
• Stable: A rating is unlikely to change.
• Negative: A rating may be lowered.
• Developing: A rating may be raised, lowered, or affirmed.

As mentioned, S&P upgraded India’s long-term sovereign credit rating to ‘BBB’ from ‘BBB-‘, with a stable outlook.

RATINGS BY OTHER AGENCIES : 

S&P is not the only agency to have recently upgraded India’s rating. Morningstar DBRS also upgraded India’s sovereign rating to ‘BBB’ with a stable outlook in May 2025.

This means that out of the major global rating agencies, two have now rated India at ‘BBB’. The other two major agencies, Moody’s and Fitch, continue to rate India at the lowest investment grade, with a stable outlook.

The S&P upgrade is particularly significant because it is one of the three largest and most influential credit rating agencies in the world

S&P Global Ratings

Fitch Ratings

Moody’s Investors Service

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