Despite its unimpressive performance in the 2014 AFC Challenge Cup qualifiers earlier this month, India jumped 24 places to occupy 143rd in the FIFA rankings, issued on Thursday.
India earned 79 points this month for a total of 177 points and jumped from 167 to 143.
The ranking is the best in more than two years, after the 142 at the end of 2010.
India had beaten Chinese Taipei (2-1) and Guam (4-0) before losing to Myanmar 0-1 in the 2014 AFC Challenge Cup qualifiers in Yangon earlier this month.
The country is now ranked 22nd among Asian countries and highest in South Asia. It is ranked higher than the likes of Indonesia, Singapore, Malaysia, Hong Kong, Tajikistan, Myanmar, Philippines and Palestine.