According to the Business Outlook Survey by the Confederation of Indian Industry (CII), the Indian industry is upbeat on its growth prospects after the new government took charge at the Centre. Most of the respondents are upbeat about their businesses in the first quarter of 2014-15 than the previous quarter.
The CII Business Confidence Index (CII-BCI) for the April-June quarter of 2014-15 rose from 49.9 in the Q4 FY14 to 53.7 points in Q1FY15, above 50 mark that separates strong business sentiments from weak. CII’s survey is based on responses from over 150 industry members and around 54 percent of the respondents were from the manufacturing sector while 45 percent were from services.
The survey found that most businesses, besides increasing new investment, have started experiencing a rise in capacity utilisation, which augurs well for turnaround of the economy. Around 56 percent of the respondents expect their sales and new orders to increase in the first quarter of 2014-15 is much higher than the previous quarter wherein only around 35 percent respondents expected a rise in sales.
The CII Director-General Chandrajit Banerjee stated that business sentiments got a boost amid expectations that a stable government at the Centre would bring growth back to India along with a mild upturn in some economic indicators in the form of decline in twin deficits, recovery in exports, buoyant foreign capital inflows, strengthening rupee and moderating inflation. C Banerjee expects that index to gather momentum in the coming days, riding on improved business confidence.
