Overview
- Moody’s Ratings, in a cross‑country study released Tuesday, ranks India the most resilient large emerging market since 2020 and places it in a top tier with Thailand, Malaysia, and Indonesia.
- The agency points to policy steps taken before recent shocks, including the Reserve Bank of India’s 2016 inflation‑targeting rule and sizable foreign‑exchange reserves that helped steady the rupee and investor confidence.
- Market signals back the finding across the pandemic in 2020, 2022 inflation and Fed hikes, 2023 US bank stress, and 2025 tariff tensions, with only brief moves in sovereign borrowing costs, contained currency drops, and orderly bond‑yield swings.
- Lower reliance on foreign borrowing cut India’s sensitivity to global risk swings, though it shifted more funding risk to domestic markets and kept local yields relatively high.
- The report warns that high public debt and weak fiscal balances leave less room for stimulus if shocks hit again.