Japan’s R&I upgrades India’s sovereign rating to BBB+, third upgrade in 2025

Japan’s Rating and Investment Information, Inc. (R&I) has upgraded India’s long-term sovereign credit rating to BBB+ from BBB, while retaining a “Stable” outlook for the economy.

This marks the third upgrade for India by a sovereign credit rating agency in 2025, following S&P’s move to BBB (from BBB-) in August and Morningstar DBRS’ upgrade to BBB (from BBB (low)) in May.

In its review published Friday, R&I cited India’s position as one of the world’s fastest-growing economies, supported by a demographic dividend, resilient domestic demand, and sound policy measures. The agency also noted fiscal consolidation through buoyant tax revenues and subsidy rationalisation, a manageable debt level, and sustained high growth.

R&I further highlighted India’s improved external stability, pointing to a modest current account deficit, consistent surpluses in services and remittances, a low external debt-to-GDP ratio, and adequate foreign exchange reserves.

In a statement, the Finance Ministry welcomed the rating upgrade by R&I, and said the government remains committed to building on this momentum through policies that promote inclusive, high-quality growth alongside fiscal prudence and macroeconomic stability.

Three credit rating upgrades for India in five months reflect increasing global recognition for India’s robust and resilient macroeconomic fundamentals and prudent fiscal management, and underscore global confidence in India’s medium-term growth prospects amid prevailing global uncertainties, the ministry added.