International rating agency, Moody’s Investors Service has upgraded India’s local and foreign currency issuer ratings to Baa2 from Baa3 and changed the outlook on the rating to stable from positive.

Sovereign credit ratings act as a guide to measure an economy’s monetary, fiscal and regulatory environment, as well as, policy consistency. A favourable rating increase the economy’s chance to be a global hub for business and investment destination.

As per a statement by the agency, it has also upgraded India’s local currency senior unsecured rating from Baa3 to Baa2 and its short term local currency rating to P-2 from P-3.

Moreover, the upgradation credit has been given to Narendra Modi government, for its wide ranging program of economic and institutional reforms.

Read EquityPandit’s Technical Analysis of Indian Stock Market