India Inc bullish about state of the economy

India Inc is upbeat over the future prospects of the economy and feels that current overall economic conditions are 'moderately to substantially better' compared to the last six months.

The Federation of Indian Chambers of Commerce and Industry (Ficci) Business Confidence Index (BCI) for July to September 2004 stands at 69.2 which is a gain of 3.5 per cent over the last quarter value of 66.7.

The Current Conditions Index (CCI) has registered a gain of 2.6 per cent, going up to 67.8. The Expectations Index (EI) is up 4.3 per cent to 69.9.

As per the Ficci-BCI survey of 378 companies, a majority 57 per cent of the respondents feel economic conditions are 'Moderately to Substantially better'. While 65 per cent of the respondents expect economic conditions to be better in the coming six months.

About 59 per cent feel that their respective sectors are currently performing moderately to substantially better as compared to the industry's performance during the last six months.

The survey said that key government announcements like the new foreign trade policy, setting up of the National Manufacturing Competitiveness Council, Investment Commission, adequate thrust on infrastructure and continuation of the disinvestment programme are said to have boosted sentiments of Corporate India.

About 70 per cent of the participants feel that government's commitment to improve competitiveness of the Indian industry would have a positive impact on performance during the next six months.

The corporate results for the second quarter of the current fiscal show that 71 per cent respondents reported a much-improved performance compared to the last six months. The services sector is most upbeat about its present performance, followed by the heavy and the light industry.

While 63 per cent of the respondents from the services sector reported that their current industry performance is 'moderately to substantially' better compared to last six month, the respective numbers for the heavy and light industry were 61 per cent and 54 per cent.

About 71 per cent of the respondents have said that their firm is performing 'moderately to substantially' better as compared to the last six months. This is an improvement over the 63 per cent who had responded similarly in the last survey.