Third Upgrade in 5 Months: India’s Credit Rating Hits BBB+ with R&I Boost
Today, 19 September 2025, the Japanese credit rating agency Rating and Investment Information, Inc. (R&I)upgraded India’s long-term sovereign credit rating to BBB+ (Stable).
For the first time in years, India has climbed a step higher on the global credit ladder.
This is India’s third sovereign upgrade in 2025 after:
- S&P Global: BBB– → BBB (Aug 2025)
- Morningstar DBRS: BBB (low) → BBB (May 2025)
Together, these upgrades reflect growing global recognition of India’s resilient growth model, prudent fiscal management, and improved external stability.
What Does BBB+ Mean?
Credit ratings are like a report card for a country’s ability to repay debt:
- AAA / AA – Top-tier safety (Germany, Singapore, Switzerland).
- A / BBB – Investment grade (creditworthy, but with some risks).
- BB and below – Speculative or “junk” grade (higher risk).
India’s BBB+ sits in the investment grade bracket – two notches above the minimum (BBB–) – signalling that investors see Indian bonds as relatively safe.
Who Gives These Ratings?
The Big Three global agencies:
- S&P Global Ratings – Scale: AAA → D
- Moody’s Investors Service – Scale: Aaa → C
- Fitch Ratings – Scale: AAA → D
Other credible players: Morningstar DBRS (Canada), R&I (Japan), JCR (Japan).
What Do They Consider?
Most agencies look at:
- Economic strength – GDP size, growth, demographics.
- Fiscal health – Debt-to-GDP, deficit, tax revenues.
- External position – Current account, forex reserves, remittances.
- Institutions & politics – Stability, governance, ease of doing business.
- Event risks – Banking crises, wars, external shocks.
Simplified formula:
Rating = Economic + Fiscal + External + Political – Risks
Why This Upgrade Matters
- Cheaper borrowing – Govt & corporates may get better loan terms.
- Investor confidence – Attracts more FDI & portfolio flows.
- Global signalling – Reforms and fiscal discipline are being recognised.
India vs The World
- AAA nations: Germany, Singapore, Switzerland, Norway.
- India today:
- BBB+ (R&I)
- BBB (S&P, DBRS)
- Baa3 (Moody’s)
- BBB– (Fitch)
India has climbed in 2025, but to enter the elite “A” category, it must sustain deficit control, manage debt, and push reforms.
Takeaway
Three upgrades in five months show India is on the right track.
The world is watching – and rewarding – India’s resilience, but the journey to an “A” sovereign rating will require consistency and discipline.
Source: Ministry of Finance, PIB
