Japanese credit rating agency JCR upgrades India to A-, Finance Ministry welcomes move
The Japan Credit Rating Agency (JCR) has upgraded India's sovereign credit rating to 'A-' citing robust economic growth and improved financial system stability. The Indian Finance Ministry welcomed the move, noting that it will help lower future borrowing costs.
Why it matters
A credit rating upgrade signals international investor confidence and can reduce the cost of capital for the national government.
The Japan Credit Rating Agency (JCR) has upgraded India’s credit rating by one notch from BBB+’ to ‘A-, it announced on Wednesday, on the back of India’s relatively high growth, the government’s growth-oriented policies, and the improved strength of the financial system.
The Ministry of Finance has issued a statement welcoming the development, saying that this comes against the backdrop of a challenging global environment.
A higher rating means that India can borrow at lower costs in the future, leading to a lower interest burden on the exchequer.
“The Indian economy has maintained a high growth rate of around 7%, supported by robust private consumption and public investment,” JCR said in its rationale for the ratings upgrade.
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