Fitch highlights challenges for India's rating upgrade due to high debt levels

Fitch Ratings has stated that India's high public debt and interest payments are major obstacles to a sovereign rating upgrade. The country's debt-to-GDP ratio exceeds 80%, significantly higher than similar-rated countries. Despite government efforts to improve fiscal health, achieving debt reduction targets may be difficult if economic growth slows. Fitch affirmed India's long-term foreign currency issuer rating at 'BBB-' in August, citing a strong growth outlook. The Indian government aims to reduce its debt-to-GDP ratio to around 50% by March 2031. However, challenges remain, including a high interest-to-revenue ratio of 25%, which is well above the median for its rating category.