Blitz Bureau
NEW DELHI: Global ratings agency Fitch on August 11 affirmed India’s long-term issuer default ratings (IDRs) at BBB- with a stable outlook, and its short-term IDRs at ‘F3’, reflecting the country’s robust growth outlook and solid external finance fundamentals.
Fitch Ratings said in a note that a strengthening record of delivering macroeconomic stability and improving policy credibility should underpin continued robust growth and enhance economic resilience, despite near-term macroeconomic headwinds from the energy shock.
“High growth should also support a sustained improvement in structural credit metrics and increase the likelihood that government debt will trend down,” the rating agency said.
India’s economy remains strong, despite headwinds from the energy shock.
“We forecast GDP growth of 6.4 per cent in the fiscal year ending March 2027 (FY27). This is slower than the average 7.4 per cent over the past three years but is still three times the 2.0 per cent ‘BBB’ median,” said Fitch.
Healthy corporate and bank balance sheets should support private investment over time, despite recent restraint.
It further stated that India’s economy has been resilient to shocks in recent years, a trend “we expect to continue”.
“There are residual risks from uncertainty related to the US-Iran conflict, given India’s position as large net energy importer position, but we do not expect a durable risk to growth prospects,” Fitch noted.
Headline inflation is rising from the energy shock, but “we expect it to stay within the Reserve Bank of India’s (RBI) 2-6 per cent band, averaging 4.1 per cent in FY27 from 2.1 per cent in FY26. Inflation appears anchored, with core inflation steady at around 4 per cent”, it said.
