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Japan Agency Upgrades India Rating; Singh Defends New GDP Method
Japan’s credit-rating agency gave India a better economic rating.
India moved from BBB+ to A-, and the outlook was stable.
N.K. Singh celebrated the decision and defended India’s new way of measuring economic growth.
He said changing the base year is a normal practice used around the world.
He also said the new system uses double deflation and more than 300 price measures.
Some critics have questioned whether the revised system makes growth look stronger.
Singh said the old and new methods should not be compared directly because they measure things differently.
The rating agency cited strong growth, digital infrastructure, tax reforms, consumer spending and government investment as positives.
Japan’s rating agency upgraded India from BBB+ to A- with a stable outlook.
Former Finance Commission Chairman N.K. Singh called the upgrade a “magical moment” for India.
India recorded 7.8% real GDP growth in the April–June quarter, exceeding expectations.
Singh defended the revised GDP series, including its changed base year and double-deflation method.
The Japanese Credit Rating Agency said India grew 7.7% in real terms in FY2026 and expects growth above 6% in FY2027.
- Who
- The Japanese Credit Rating Agency and N.K. Singh, former Chairman of India’s Finance Commission, are central to the report.
- What
- The agency upgraded India’s rating from BBB+ to A- with a stable outlook, while Singh defended India’s revised GDP methodology.
- Where
- India; Singh’s comments were posted on social media.
- When
- The report cites September 2, 2026, when Singh posted his comments, and refers to the April–June quarter and FY2026.
- Why
- The agency cited India’s economic growth, digital public infrastructure, GST implementation, resilient consumption and public investment.
Methodology Supporters
Methodology Critics
Changing the GDP base year
Methodology Supporters
N.K. Singh said base years are regularly changed worldwide to reflect changing economic realities and structures, not to make current growth appear higher.
Methodology Critics
Critics have questioned the revised GDP numbers and whether the methodology change affects the reported strength of growth.
Comparing old and new GDP series
Methodology Supporters
Singh said direct comparison is “apples-to-oranges” because the new series follows different methods and uses more granular price deflators.
Methodology Critics
Critics’ concerns, as described in the report, center on interpreting the latest growth figures after the methodology was revised.
Key facts
- Rating change
- India was upgraded from BBB+ to A-.
- Outlook
- The new rating has a stable outlook.
- Quarterly growth
- India recorded 7.8% real GDP growth in the April–June quarter.
- FY2026 growth
- The Japanese Credit Rating Agency said India’s economy expanded 7.7% in real terms in FY2026.
- FY2027 forecast
- The agency expects India’s growth to remain above 6% in FY2027.
- GDP methodology
- The revised series uses double deflation, a new Series of Output Producer Price Index and more than 300 individual price deflators.
- Singh’s position
- Singh said changing GDP base years is standard statistical practice and that the new and old series should not be compared mechanically.
Quotes
N.K. Singh
Former chairman of India’s Finance Commission commenting on the rating upgrade and GDP methodology.
“Comparing mechanically with the old series is apples-to-oranges. The new GDP series is more robust, aligned with global SNA2008 standards using the ‘New Series of Output Producer Price Index (PPI)’. ‘More than 300 individual price deflators’ elicits granularity of the estimate.”
businesstoday.in
“The A-rating upgrade by the Japanese Credit Rating Agency is a magical moment for India and calls for celebration. We need to applaud the robustness of the new GDP methodology. Double deflation is embedded in scientific reasons, long-demanded as a methodological improvement.”
businesstoday.in
Sources
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