Moody’s Investors Service has reported that India will be the fastest-growing G-20 economy over the next few years, with expansion of manufacturing and infrastructure sectors. However, reform and policy barriers could hamper investment. In a research report, the US-based agency has also warned that bureaucracy could slow processes in obtaining approvals.


India is now the world’s most populous country and the fifth-largest economy globally, with its GDP scaling $3.5 trillion in 2022. The government’s infrastructure spending will bolster steel and cement sectors, while India’s net-zero commitment will drive investment in renewable energy. Larger production capacity will raise rated companies’ competitiveness in these sectors, a credit positive if they manage execution risks with financial discipline.


The report also states that while demand across the manufacturing and infrastructure sectors will grow 3-12% annually for the rest of the decade, India’s capacity will still rank well behind China’s by 2030. Leading companies will invest around $150 billion in additional capacity, requiring access to multiple funding sources, but most rated companies can tolerate a rise in debt.

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