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New Delhi: According to S&P Global Ratings, an American credit rating agency and a division of S&P Global, India will show resilience against tariff barriers and global trade shocks. Also, as per the company, India's economy can expand about 6.5% in 2025 and will rise to around 7% in the next two years, as per President Yann Le Pallec in an interview with the Economic Times.
Calling India a sought-after place among investors, Pallec said during his conversation with ET, “For now, global investors continue to view India as one of the most attractive destinations for capital seeking stable, long-term growth opportunities.”
Notably, S&P has upgraded India's sovereign rating to ‘BBB’, the first such upgrade by a global agency in 18 years. About that, Pallec said, "We upgraded India’s rating to BBB stable a few months ago, recognising its economic resilience, stable policy framework, and continued investments in physical and energy infrastructure. Our ratings are forward-looking, and we expect this resilience to hold, with GDP growth of about 6.5% this year, rising to around 7% over the next two years, which is impressive for one of the world’s top 5 economies."
When asked if there are any key risks that Indian policymakers should be cautioned of in the future, the Frenchman said, "Externally, we see more potential to strengthen India’s growth than real downside risks. The momentum is remarkable, with a few top-five economies able to sustain around 7% growth for a decade. The IMF recently noted that reaching India’s 2047 goals would require growth above 8% for the next 20 years, which is ambitious but achievable with the right measures."
He commented on whether global interest rate cycles and volatility will affect the Indian economy. Pallec said, "Our economists expect the Reserve Bank of India to cut rates by 25 basis points by year-end. With capital rotating out of the US, India is emerging as a key investment destination, benefiting from strong tailwinds."
While talking about India’s inclusion in global bond indices, he said it "will draw more investors, while Crisil continues to play a key role in improving transparency for domestic institutions. Through our GIFT City operations, S&P Global Ratings aims to do the same for international investors, offering a clearer view into India’s credit landscape."
