Further, it noted that large foreign exchange-reserves played a key role in stabilising currency volatility and reinforcing confidence in India during global shocks.
The analysis is based on market indicators such as sovereign spreads, local‑currency yields and exchange‑rate movements covering emerging markets including Mexico, Indonesia, Brazil, South Africa and Thailand.
“Compared with more fragile emerging markets such as Turkey, Argentina and Nigeria, India absorbed shocks primarily through price adjustments rather than sustained financing stress, benefiting from deeper local markets and stronger policy credibility,” said the rating agency.
However, the report cautioned that India’s relatively high debt levels and weak fiscal balance constrain its ability to respond to repeated shocks.
Thailand is also identified as being relatively well prepared to handle future global shocks, benefitting from strong external fundamentals, a healthy balance of payments, and moderate external debt.In contrast, Turkey, Argentina and Nigeria remain less prepared due to incomplete or delayed policy reforms.
The report pointed out that India, Mexico and Brazil rely less on external borrowing, which reduces their exposure to shifts in global risk sentiment. However, this also concentrates risks within domestic markets and keeps domestic yields relatively high.