Moody’s Upgrades India’s Rating

New York City-based  Moody’s Investors Service‘s upgrading India’s sovereign credit rating for the first time since 2004 to Baa2 from Baa3, and changing the outlook to ‘stable’ from ‘positive’, is a boost to the Modi government’s reform agenda.

Bloomberg says that the upgrade adds to a string of good news for Modi. The World Bank said it’s getting easier to do business in India, with Asia’s third-largest economy jumping 30 places to rank 100th in the latest ranking released last month. Earlier this week, Pew Research Center said Modi remained a popular leader and public confidence in the economy and the overall direction had improved.

A poster saying 'analysis'

  • India is the largest economy among all Baa2-rated sovereigns
  • The Philippines is the only other Baa2-rated country in Asia
  • India ahead of other BRICS — Russia-Ba1, South Africa-Baa3, Brazil-Ba2
  • Among BRICS, only India, China and South Africa are investment grade
  • On a PPP basis, India’s GDP per capita has outstripped the Baa-rated median (19 countries)
  • Between 2006 and 2016, this grew 108% vs. 74% for Baa-rated median
Moody’s forecasts GDP growth of 6.7 percent for the fiscal year through March 2018, with a pick up to 7.5 percent in the following year and “similarly robust” levels from 2019 onward — that’s in line with the median 6.8 percent and 7.4 percent estimates in a Bloomberg survey.

 

 

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Posted on by Gunjan Bagla
Gunjan Bagla
California-based management consultant Gunjan Bagla runs Amritt, a consulting firm helping American companies to succeed in India. Amritt is the trusted advisor for India market research, India business development, India market entry, Global Engineering, Global Technology Scouting, India R&D and Open Innovation. Gunjan is author of "Business in 21st Century India: How to Profit Today from Tomorrow’s Most Exciting Market" (Hachette Book Group, 2008), Amazon's top rated title on the subject. He has appeared as the India Expert on BBC Television, Bloomberg TV, Fox Cable Business and has been quoted in the New York Times, the Los Angeles Times, the Hollywood Reporter and Business Week for his expertise on India.

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