Moody’s Investors Service on Friday upgraded India’s sovereign rating by a notch to Baa3
What does this really imply? And how big a good news
is this for the country? Simply put, sovereign credit rating is the measure of risk associated while investing in a particular country. A higher rating is not only a reflection of economic and political stability in a country but is also helpful in garnering more foreign direct investment
(FDI) and funds from the international bond markets. The Moody's upgrade of India to Baa2
indicates a mid-range ranking in this category, up from the lower end of the generic category that the country has been in for the past 14 years.
Refer to the table below to understand what the various credit ratings mean and assess the change in India's status on the ranking: