📊 Comparative Analysis: Indian vs. International Credit Rating Agencies
Here's a structured outline for a Comparative Analysis Between Indian and International Credit Rating Agencies — you can use this for a report, presentation, academic paper, or policy brief.
1️⃣ Introduction
- Definition and role of Credit Rating Agencies (CRAs)
- Importance in financial markets
- Purpose of the comparison: To understand similarities, differences, and strategic implications
2️⃣ Key Players
|
Aspect
|
Indian CRAs
|
International CRAs
|
|
Leading Agencies
|
CRISIL, ICRA, CARE, India Ratings, Brickwork
|
S&P, Moody’s, Fitch, DBRS, JCR
|
|
Year of Origin
|
1987 (CRISIL) onwards
|
1860s–1900s
|
|
Ownership
|
Indian FIs, Banks, Govt-Private mix
|
Global corporations, stock-listed firms
|
3️⃣ Regulatory Framework
|
Area
|
Indian CRAs
|
International CRAs
|
|
Regulator
|
SEBI
|
SEC (US), ESMA (EU), IOSCO standards
|
|
Key Regulation
|
SEBI (CRA) Regulations, 1999
|
CRA Reform Act (US), EU CRA Regulation
|
|
Rating Disclosure
|
Mandatory for public ratings
|
Mandatory globally
|
|
Surveillance & Review
|
Required periodically
|
Required with detailed audit trail
|
4️⃣ Scope of Work
|
Function
|
Indian CRAs
|
International CRAs
|
|
Sovereign Ratings
|
Limited (India only)
|
Global (over 120 countries)
|
|
Corporate Ratings
|
Yes
|
Yes
|
|
SME Ratings
|
Actively done
|
Rarely done
|
|
Structured Finance
|
Moderate
|
High (especially post-2008 reforms)
|
|
ESG/Green Ratings
|
Emerging
|
Rapidly growing segment
|
5️⃣ Methodology & Influence
|
Parameter
|
Indian CRAs
|
International CRAs
|
|
Methodology
|
Largely aligned to international standards
|
Uniform but adapted per region
|
|
Market Influence
|
High domestically, limited globally
|
Globally influential
|
|
Transparency
|
Improving
|
Criticized post-2008; reforms underway
|
6️⃣ Challenges Faced
|
Challenge
|
Indian CRAs
|
International CRAs
|
|
Conflict of Interest
|
Issuer-pays model risk
|
Same model; criticism during 2008 crisis
|
|
Default Tracking
|
IL&FS, DHFL downgrades questioned
|
Lehman, AIG cases cited
|
|
Limited Global Reach
|
Outside India influence is low
|
Geopolitical influence often alleged
|
7️⃣ Strengths & Weaknesses
|
Criteria
|
Indian CRAs
|
International CRAs
|
|
Strength
|
Local expertise, SME coverage
|
Global credibility, sovereign reach
|
|
Weakness
|
Perceived leniency, limited global standing
|
Geopolitical bias, systemic risk contribution
|
8️⃣ Conclusion & Recommendations
- Indian CRAs need:
- Better independence & global partnerships
- Focus on methodology, transparency, and post-rating surveillance
- Global CRAs must:
- Improve neutrality & governance
- Include emerging market perspectives
- Both systems must be accountable, transparent, and resilient to conflicts of interest.
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