Fitch Maintains India's Sovereign Ratings At 'BBB-'

(RTTNews) - Fitch Ratings retained India's sovereign ratings at 'BBB-' citing strong growth and solid external finances. The outlook on the ratings remained 'stable'.

The rating agency said India's economic outlook remained strong relative to peers but US tariffs are a moderate downside risk to forecast. The economy is projected to expand 6.5 percent in the fiscal year ending March 2026, which was well above the 'BBB' median of 2.5 percent.

Fitch said the direct impact of higher US tariff on India GDP will be modest as exports to the US account for 2 percent of GDP, but tariff uncertainty will dampen business sentiment and investment.

Proposed reforms to goods and services tax, if adopted, would boost consumption and helps to offset some of these growth risks, Fitch observed.

The general government deficit was estimated to narrow to 7.3 percent of GDP in FY26 and 7.0 percent by FY28 from a Fitch-estimated 7.8 percent in FY25.

Earlier this month, S&P Global Ratings upgraded India's sovereign ratings to 'BBB' from 'BBB-' and retained outlook at stable.