Mumbai (Maharashtra) [India], October 3 (ANI): CareEdge Global IFSC Ltd, a subsidiary of CARE Ratings Ltd, has launched its Sovereign Ratings for 39 countries, marking its entry into the Global Scale Ratings space.
According to CareEdge, with this launch, it has become the first Indian credit rating agency to assess global economies, providing long-term foreign currency (LTFC) ratings.
As part of its inaugural release, CareEdge assigned a BBB+ rating to India, reflecting the country’s strong post-pandemic recovery and its focus on infrastructure investments.
CareEdge Global’s assessment highlights India’s resilient economic performance, projecting GDP growth in the range of 6.5-7 per cent in the coming years.
According to CareEdge, India’s general government debt is expected to gradually decrease to 78 per cent of GDP by FY30 and further to 73.5 per cent by FY35, driven by healthy nominal GDP growth. However, CareEdge noted that India’s elevated government debt levels and weak debt affordability remain key credit constraints.
Mehul Pandya, Managing Director & Group CEO of CareEdge, said, “This is a significant milestone for us in our journey towards becoming a global knowledge-based institution. As India’s economic influence grows, it is both timely and appropriate for an Indian company to enter this domain.”
He further said, “We are convinced that it is very important to have transparency in methodology of sovereign ratings, particularly in assessing the growth potential and investment needs of economies. This reflects in the ratings assigned by us,” he added.
However, high general government debt, weak debt affordability, and vulnerability to global oil price shocks due to its 85 per cent dependency on oil imports are noted risks.
In addition to India, CareEdge Global has assigned ratings to 38 other countries. Top-rated countries include Germany, the Netherlands, Singapore, and Sweden, all rated AAA.
Other highly rated nations include Australia, Canada, and the USA with AA+ ratings. Several other major economies like France, Japan, and the UK received AA- ratings, while China was assigned an A rating. The BBB+ rating category, where India stands, also includes countries like Botswana and the Philippines.
Revati Kasture, Executive Director at CareEdge Ratings, stated, “Our methodology is robust and ensures equal treatment of both developed and emerging economies by using consistent thresholds across all countries. The ratings generated through our approach will support investors and enrich the range of perspectives on different countries and markets.”
CareEdge Global’s Sovereign Ratings are based on a comprehensive assessment of five key pillars: Economic Structure & Resilience, Fiscal Strength, External Position & Linkages, Monetary & Financial Stability, and Institutions & Quality of Governance.
Rajani Sinha, Chief Economist at CareEdge Ratings, said, “India has demonstrated strong reform commitment in recent years with the implementation of several initiatives such as Digital India, the Production Linked Incentive scheme, PM Gati Shakti etc.”
Sinha added, “The government’s focus on improving the economy’s competitiveness, boosting foreign trade, and increased focus on infrastructure investments are positives. Additionally, the demographic dividend presents a crucial opportunity to harness India’s growth potential.”
The launch of the Sovereign Ratings report took place at an event in GIFT City, Gandhinagar, India, attended by industry leaders and policymakers. Eminent personalities such as K.V. Kamath, Ashishkumar Chauhan (MD & CEO, NSE), and Sanjeev Sanyal (Member, EAC-PM) were present at the unveiling. (ANI)
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