Commenting on the outlook revision, SBI Chairperson Arundhati Bhattacharya said, "We believe that the country is well on a path of faster than anticipated fiscal consolidation and it could be a positive surprise going forward."
Japanese brokerage firm, Nomura, said that a stable government and "proactive policy measures to strengthen the country's macroeconomic fundamentals should help put the economy back on a high growth trajectory".
Nomura expects the country's real GDP growth to rise from 4.7 per cent in FY14 to 6 per cent year-on-year in FY15 and 6.8 per cent in FY16.
Global rating agency also affirmed the country's long-term credit ratings at 'BBB-' and short-term at 'A-3'.
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It said the outlook revision reflects that the country's improved political setting offers a conducive environment for reforms, which could boost growth prospects and improve fiscal management.
"The ratings reflect the country's strong external profile, combined with its democratic institutions and free press, both of which underpin policy stability and predictability," S&P said.
"With the rating institution indicating a revision in rating conditional on a growth uptick and our internal prognosis suggesting a strong possibility of the same, we look forward to even better times ahead," Bhattacharya said.