India Inc's business confidence surges, says CII
The business confidence of India Inc has improved in the wake of the economic revival, says a survey by the Confederation of Indian Industry. However, slack consumer demand remains a concern.business Updated: Oct 25, 2009 11:53 IST
The business confidence of India Inc has improved in the wake of the economic revival, says a survey by the Confederation of Indian Industry (CII). However, slack consumer demand remains a concern.
According to the CII Business Outlook Survey, business confidence has surged by 7.4 points to 66.1 for for October-March as compared to a 2.4 points increase during the first half of the fiscal.
However, slack consumer demand remains a major concern for the economy, CII said. The industry has "better prospects for the coming six months and the economy has indeed bottomed out", said Chandrajit Banerjee, director general of CII.
"However, an uncertain global economic outlook and slackening consumer demand still remain major concerns for the business community, followed by infrastructural and institutional shortages," it added.
The Current Situation Index (CSI) gained 5.9 points for the October-March period from the previous six months.
"It suggests that the government's timely interventions with counter-cyclical fiscal and monetary measures are showing an impact and helping the economy recover," the survey said.
The Expectations Index (EI) that reflects the expectation of Indian industry with regard to performance of their company, sector and the economy gained 8.1 points, suggesting that businesses are optimistic about an economic rebound in the second half.
Of the 450 companies surveyed, 54 per cent expect economic growth for the current fiscal to range between 6 and 7 per cent. Inflation, according to 82 per cent of the respondents, will be below five percent in 2009-10.
Eighty percent of the respondents feel that the Indian economy will witness a turnaround and begin returning to normal growth in the second half of 2009-10.
The survey said 52 per cent of the respondents plan to increase investments in the coming six months.
About 78 per cent of the respondents expect new orders to increase in the next six months.