India’s markets, along with related country-specific exchange traded funds, appear less risky after the Standard & Poor’s rating agency raised the country’s credit outlook, reducing the prospect of a downgrade to junk status any time soon.

On Friday, the WisdomTree India Earnings Fund (NYSEArca: EPI) was up 1.8%, iShares MSCI India ETF (NYSEArca: INDA) rose 1.2% and PowerShares India Portfolio (NYSEArca: PIN) gained 1.5%. Year-to-date, EPI is up 26.3%, INDA is 22.1% higher and increased 22.3%.

India maintained its BBB- rating, the lowest investment-grade rating, and the S&P stated that it could upgrade the rating if economic growth advances and shows improved fiscal, external or inflation metrics, Bloomberg reports.

“The stable outlook for the next 24 months reflects our view that the new government has both the willingness and capacity to implement reforms necessary to restore some of India’s lost growth potential, consolidate its fiscal accounts, and permit the Reserve Bank of India to carry out effective monetary policy,” S&P said in a statement. [WisdomTree: India Shines Bright]

The S&P is referring to the new administration under Prime Minister Narendra Modi, who was elected into office on the platform of increased economic reforms. The government has pledged to cut the budget deficit to 4.1% of gross domestic product in the  year through March 2015 from 4.5% over the previous year.

Additionally, the improved outlook on Indian bond securities helps diminish the risk of a major sell-off once the U.S. hikes interest rates. Global investors pulled $8 billion out of rupee-denominated bonds last year after the Federal Reserve began tapering its bond purchasing program. [Emerging Asia ETFs Can Shake Off Effects of Rising U.S. Rates]

“Indian authorities are aware they have to get their house in order before the easy money ends,” Jonathan Cavenagh, a strategist at Westpac Banking Corp., said in the article, adding that a rating downgrade would disqualify Indian assets from meeting purchase criteria of several funds.

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