Japanese rating agency R&I has upgraded India's long-term credit rating to BBB+ (Triple B Plus). This is the third upgrade India has received in the year 2025. The agency stated that the domestic demand-driven economy would not be affected by high tariff policies in the US. The rating improvement will enhance investment attractiveness and economic stability.
Credit Rating: Japanese rating agency R&I on Friday upgraded India's long-term sovereign credit rating to BBB+ and maintained a stable outlook. This marks India's third rating upgrade in the year 2025, with S&P and Morningstar DBRS having also improved India's rating previously. The report stated that India's economic growth is based on domestic demand, hence US tariff policies and global risks will not have a significant impact. The government welcomed this move, stating that the rating improvement will help increase investment attractiveness and economic stability.
Meaning of Rating Upgrade
A credit rating indicates a country's ability to meet its financial obligations. A higher rating means the country is less risky and suitable for investment. A Triple B rating is generally considered investment-grade. An increase in rating leads to lower borrowing costs and attracts more foreign investment. As a result, the country's economy strengthens, and development opportunities increase.
What the Report Said
R&I's report highlighted India's economic resilience as being driven by domestic demand. The agency stated that high tariff policies of countries like the US and global risks would not have a significant impact on India. R&I also praised the government's policies, noting that the government has focused on promoting growth while maintaining fiscal discipline.
The R&I report also stated that India's economy is expected to remain robust in the coming period. Domestic demand, efforts to boost investment, and fiscal discipline are keeping the Indian economy stable and attractive for investors.
Previous Rating Upgrades
Prior to this, India received rating upgrades from two other agencies in 2025. In May 2025, Morningstar DBRS upgraded India's credit rating from Triple B Low to Triple B. Subsequently, in August 2025, S&P upgraded it from Triple B Minus to Triple B. Thus, R&I's decision marks the third significant indicator of India's stable economic growth.
Government of India's Welcome
The Government of India has welcomed this upgrade. The Ministry of Finance stated that this is the third major agency in the current fiscal year to confirm an improvement in India's rating. The ministry emphasized the government's commitment to promoting inclusive and high-quality growth, along with maintaining fiscal prudence and macroeconomic stability.
The government also added that the rating upgrade enhances India's credibility among foreign investors and in global markets. This strengthens investor confidence and increases the likelihood of new capital inflows.
What the Upgrade Means for the Economy
An improvement in credit rating signifies that the country becomes more reliable for foreign investors and lending institutions. It reduces the cost of investment and attracts foreign capital. Countries with higher ratings can accelerate investment in their development and infrastructure.
Due to India's growth structure being based on domestic demand, the impact of global risks and trade wars will be mitigated. This will keep India relatively safe from economic downturns or global crises. Investors will consider it safe to invest in India for the long term.
