Global rating agencies upgrade India as GDP growth sparks domestic debate
Three major rating firms raised India's FY27 growth outlook after the country posted a 7.8% quarterly expansion, while officials dispute the new GDP methodology.
Fitch increased its FY27 growth projection by 50 basis points, while S&P Global Ratings and Moody's both raised theirs to 7%, pointing to robust domestic demand, credit expansion and resilient output despite high oil prices and geopolitical tensions. Investment surged, with gross fixed capital formation up 11.9% and manufacturing expanding 9.2% in the June quarter. Critics, including former Finance Secretary Subhash Chandra Garg, argue that the shift to a new GDP series makes year-on-year comparisons misleading, urging analysis in current-price terms.
Former RBI Governor Raghuram Rajan highlighted the lack of corresponding job creation and foreign direct investment. The government rejected these critiques, stating the revised figures reflect updated data and methodology rather than an artificial boost.
