Grant Thornton in its latest International Business Report (IBR), a quarterly global business survey, has said that India slipped to the 7th position in the September quarter from the 2nd spot in the previous three months in its ‘business optimism index’, showing clear signs of lag in the economy. According to the survey report, Indonesia is at the top, followed by Finland (2nd), the Netherlands (3rd), Philippines (4th), Austria (5th) and Nigeria (6th).
According to the report, Indian businesses have expressed low confidence over revenue expectations in the next 12 months. They also saw a drastic fall in confidence for profitability with 54 percent showing optimism as against 69 percent in the last quarter. Other parameters like expectations of increase in selling prices and exports have also suffered a slight fall in optimism in the quarter. However, Indian businesses remained optimistic about increase in employment as 54 percent respondents expressed the need to increase hiring in the next 12 months, a three- point rise from June quarter. Other areas where the optimism remained intact were investment in plant and machinery and Research & Development (R&D).
The report further stated that India tops the chart in citing regulations and red tape and lack of ICT infrastructure as the biggest growth constraints with 69 percent and 46 percent voting for it respectively. Indian businesses also identified shortage of finance and lack of skilled workforce as pain points of India Inc taking the 2nd and the 3rd spot respectively. But, the Government actions and reforms coupled with the significant jump in ‘Ease of Doing Business Rankings’ should bring back optimism in Indian Business in the next few quarters.
