Fitch Ratings on Monday reaffirmed India’s long-term foreign currency issuer default rating at ‘BBB-’ with a stable outlook, underscoring that the country’s strong growth momentum and solid external finances continue to support its credit profile. The agency forecast India’s GDP growth at 6.5% in FY26.
“India’s ratings are supported by its robust growth and solid external finances,” Fitch said, adding that growth alongside macro stability and improving fiscal credibility will strengthen India’s structural metrics, including GDP per capita. This, in turn, “can increase the likelihood that India’s debt can trend modestly downward in the medium term.”
At the same time, the agency highlighted that “fiscal metrics are a credit weakness, with high deficits, debt and debt service compared with ‘BBB’ peers,” while lagging governance indicators and GDP per capita also constrain the rating.
Fitch cautioned that the planned 50% tariff on India by the Trump administration represents a “moderate downside risk” to growth projections, though it expects the move “will eventually be negotiated lower.”
The affirmation comes shortly after S&P Global upgraded India’s sovereign rating earlier this month, raising it to ‘BBB’ from ‘BBB-’, citing “buoyant economic growth” and government commitment to fiscal consolidation.
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S&P forecast India’s economy to expand at an average of 6.8% annually over the next three years, while revising the short-term rating to A-2 from A-3 and the transfer and convertibility assessment to A- from BBB+.
Both agencies retained a stable outlook, reflecting expectations that sustained policy stability, high infrastructure investment, and cautious fiscal management will support India’s long-term credit trajectory.
