PTI New Delhi

Global rating agency Morningstar DBRS has upgraded India's sovereign rating to 'BBB', with a stable trend, citing structural reforms through infrastructure investments, and digitisation, besides macro economic stability.

The credit rating balances India's public finance challenges with the economy's high growth potential, DBRS Inc (Morningstar DBRS) said while upgrading India's Long-Term Foreign and Local Currency Issuer Ratings to BBB from BBB (low). "The upgrade reflects Morningstar DBRS's view that the cumulative and ongoing benefits of India's structural reform efforts are facilitating fiscal consolidation and helping sustain India's high potential growth rate. The upgrade also reflects a more resilient banking system," DBRS Morningstar said.

It said that although heightened external risks due to the imposition of US tariffs could impact growth in the coming quarters, the Indian economy is not particularly reliant on trade.