Story perspectives

India's Sovereign Rating Upgraded After 18 Years of Growth

9/1/2025

Summary

Story summary

S&P Global Ratings upgraded India's long-term sovereign rating from BBB- to BBB, the first increase in 18 years, due to strong growth and fiscal stability.
India's economy is resilient, with exports to the U.S. making up only 2% of GDP.
The Manufacturing Purchasing Managers’ Index (PMI) reached 59.3 in August, the highest in over 17 years.
Increased domestic orders and business confidence support ongoing economic growth despite global tariff challenges.
The rating upgrade is expected to lower borrowing costs and improve capital access for infrastructure investment.

History

Historical Context

India's economic reforms began in 1991, initiated by Finance Minister Manmohan Singh in response to a balance-of-payments crisis. These reforms dismantled the Licence Raj and opened the economy to foreign investment. By 2010, India's GDP growth reached 9%, reflecting the long-term impact of these changes, which have enhanced its credit ratings and facilitated infrastructure investments crucial for ongoing economic growth.

1 of 2

Story summary

S&P Global Ratings upgraded India's long-term sovereign rating from BBB- to BBB, the first increase in 18 years, due to strong growth and fiscal stability.
India's economy is resilient, with exports to the U.S. making up only 2% of GDP.
The Manufacturing Purchasing Managers’ Index (PMI) reached 59.3 in August, the highest in over 17 years.
Increased domestic orders and business confidence support ongoing economic growth despite global tariff challenges.
The rating upgrade is expected to lower borrowing costs and improve capital access for infrastructure investment.

1 / 2