Fitch Ratings on Monday unexpectedly raised India’s sovereign foreign and domestic currency ratings to investment grade, citing progress in the fiscal consolidation process, a “strong external balance sheet and an impressive growth story” as key factors prompting the upgrade.

“Fiscal consolidation is at last taking hold in India, reinforced by the impressive growth story and India’s strong external balance sheet,” said Paul Rawkins, senior director at Fitch. “Public finances are still weak, but they are no longer an insuperable constraint on this rating.”

With Moody’s already rating India as investment grade and with Standard & Poor’s ranking it just one notch away from prime status, with a positive outlook, the news will be a fillip to reformers in New Delhi arguing for faster progress towards full capital account convertibility.

Read the Financial Times full news article here.

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