After a four-quarter slide, India Inc’s business optimism registered an increase for the first quarter of this year, largely driven by GDP growth, easing FDI norms and RBI rate cuts, says a Dun & Brad
After a four-quarter slide, India Inc’s business optimism registered an increase for the first quarter of this year, largely driven by GDP growth, easing FDI norms and RBI rate cuts, says a Dun & Bradstreet report.
The Business Optimism Index, which measures the pulse of the business community, improv-ed to 85.9 for the January-March 2016 quarter, registering a rise of 2.5 per cent compared with first quarter last year. “After a four-quarter slide, the D&B Composite Business Optimism Index for Q1 2016 provides tentative evidence that the recovery should slowly resume,” D&B India senior economist Arun Singh said.
Optimism level for net profits, selling prices and level of employees saw an increase of one percentage points, while optimism for new orders rose by four percentage points.
“The acceleration in GDP growth, easing of FDI norms and rate cuts by the RBI could be partly responsible for the improvement in confidence level of corporate India in the recent period,” Mr Singh said.
The increase in government spending has clearly raised hopes of a government-led recovery. “A number of stalled projects have been de-bottlenecked and fast-tracked while hopes of a recovery in demand conditions have gathered strength due to pay panel payouts next fiscal,” he added.
