Moody’s Ratings
Moody’s has raised India’s GDP growth forecast for 2024 to 7.2%, up from an earlier estimate of 6.8%.
For 2025, the forecast is 6.6%, an increase from the previous 6.4%.
The upgrade is attributed to signs of improved rural demand and stronger household consumption.
Easing inflation, particularly with retail inflation falling to 3.5% in July, supports this positive outlook.
Moody’s highlights a favorable economic environment with strong growth and moderating inflation.
However, future growth will depend on how effectively India can utilize its labor force and implement employment and skills policies.
Fitch Ratings
Fitch has maintained India’s long-term foreign-currency issuer rating at ‘BBB-’ with a stable outlook.
Fitch also forecasts a GDP growth rate of 7.2% for 2024-25, followed by 6.5% for 2025-26.
The medium-term potential GDP growth is projected at 6.2%, supported by infrastructure investments, a strong services sector, and solid private investment.
Fitch points out ongoing fiscal weaknesses, including high deficits, debt, and debt service burdens compared to peers.
Structural issues such as governance and GDP per capita trends also impact the rating
Improved bank and corporate balance sheets are anticipated to enhance investment prospects in India.
Subdued consumer spending may disrupt the private investment cycle, potentially impacting job creation and the effective utilization of India’s demographic dividend
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