Industry Trends and Public Opinions: Analysis from CII's 128th Business Opportunity Survey
Indian Economy Shows Resilience Amid Global Uncertainties, According to CII Survey
The Indian economy appears to be holding strong in the face of global uncertainties, as indicated by the latest CII Business Confidence Index (CII-BCI). The 128th CII Business Outlook Survey, conducted in September 2024, revealed a rise in the CII-BCI to 68.2 in the second quarter of the current fiscal year. This increase suggests good overall economic health and optimism among businesses.
The survey, which featured responses from 200 firms across diverse sectors, included participation from companies of all sizes. The results highlight several growth drivers for the current fiscal year, including improved consumption patterns, favourable monsoon conditions, robust kharif crop sowing, increased private investments, moderate inflation, and strong corporate and banking balance sheets.
The survey also points to an increase in private investments as a key growth driver for the current fiscal year. In fact, 41% of the respondents feel that their domestic investments would see an increase in the second quarter of the current fiscal, while 40% of the respondents also feel that their investment plan will see no changes in the international arena.
The positive outlook is further underscored by the fact that nearly 49% of firms project an increase in employment due to improvements within their companies. Conversely, only 7% of respondents expect a decline in workforce numbers. Additionally, 45% of the respondents believe that their bottom-line will improve in the quarter.
However, the survey also identifies several areas of concern. Additional concerns include fluctuating consumption patterns, food price volatility, and financial market instability. Moreover, 17% are concerned about decreasing external demand, 18% of respondents highlight rising global commodity prices as a top business concern, and 24% of respondents cite protracted geopolitical tensions as a top business concern.
It's worth noting that Gross Fixed Capital Formation (GFCF) has seen an increase in Q1 of FY24-25. The CII-BCI, a confidence indicator based on the opinion surveys of firms and their expectation of rise in production, orders, demand, and stocks of finished goods, is a reliable gauge of these trends.
Despite these challenges, the Indian economy seems to be weathering the global storm with resilience. As we move forward, it will be interesting to see how these trends continue to unfold.
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