Japan Credit Rating Agency Upgrades India’s Sovereign Rating to ‘A-’

New Delhi, Sep 3 (KNN) Japan Credit Rating Agency (JCR) has upgraded India’s long-term foreign currency and local currency issuer ratings by one notch from ‘BBB+’ to ‘A-’, while maintaining a Stable Outlook.

JCR has also raised India’s country ceiling by one notch to ‘A’. The upgrade reflects India’s strong economic growth, improving fiscal quality, strengthened financial system and robust external position.

The agency noted that India’s economy has maintained a high growth rate, supported by private consumption and public investment. Real GDP growth stood at 7.8 per cent in FY26 and remained at 7.8 per cent in Q1 of FY27 despite global headwinds.

JCR also highlighted improvements in fiscal expenditure, particularly the greater focus on capital expenditure and infrastructure investment. The Central Government’s fiscal deficit declined from 4.7 per cent in FY25 to 4.4 per cent in FY26.

The agency noted that the soundness of India’s financial system has improved, with stronger banking sector asset quality, capital adequacy and profitability. Improvements in the non-banking financial sector also supported the assessment.

On the external sector, JCR said India’s current account deficit remains contained, supported by a services surplus, while foreign exchange reserves provide resilience against external shocks.

The upgrade follows sovereign rating revisions by other agencies, including Morningstar DBRS in May 2025, S&P Global Ratings in August 2025 and Japan’s Rating and Investment Information (R&I) in September 2025.

(KNN Bureau)