S&P Global Ratings on Wednesday kept India's sovereign rating unchanged at 'BBB-' with a stable outlook on the country's long-term rating.
The American credit rating agency said that the stable outlook "reflects it expectation that India's economy will recover" after containing the COVID-19 pandemic and the country will "maintain its sound net external position."
It also presupposes that the government's fiscal deficit will subside significantly after it touched a multi-year high in fiscal year 2021, S&P said.
The agency further stated that India's ratings reflect its above-average real GDP growth, evolving monetary settings, and strong external profile.
"While risks to India's long-term growth rate are rising, ongoing economic reforms, if executed well, should keep the country's growth rate ahead of peers," S&P said in a statement.
The agency has forecast India's economy to shrink by 5 per cent this fiscal year.
Earlier this month, Moody's Investors Service lowered India's foreign-currency and local-currency long term issuer ratings from Baa3 to Baa2, keeping the economic outlook negative.