 "India business confidence picks up in January: Survey")
The level of optimism about business environment among Indian chief financial officers (CFOs) remained muted in the first quarter of the New Year amidst a weak global economy, says a survey by an analytics firm.
Dun & Bradstreet Composite CFO Optimism Index remains subdued, registering a decline on a quarter-on-quarter basis during the first quarter of 2016. The Index fell by 6.6% on a quarter-on-quarter basis.
The downturn in the overall optimism level was led by the services sector, whose sentiment remained more subdued than the CFOs in the industrial sector.
"The strength of India's economic recovery is still uncertain amidst a weak global economy, which is weakening further," Dun & Bradstreet India Director (Risk Management Solution), Arvind Raghav said.
The optimism level among CFOs remains downbeat given that the slump in the commodity markets appears protracted.
"Heightened uncertainty about global economic recovery, elevated level of concerns on geo-political tensions along with China slowdown have impacted sentiment among CFOs as India is not likely to be an exception and remain insulated from the developments in the global economy," Raghav said.
Domestic macro-economic scenario remains favourable for 62% of the respondents while global macro-economic condition remains favourable for only 38% of respondents during the first quarter of 2016.
"In domestic market, less than expected pace of reforms, rising inflationary pressure, lower capacity utilisation rate in manufacturing sector and weak rural demand have contributed significantly to the subdued optimism among CFOs," he said.
Amidst the current scenario, how the government manoeuvres its finances to boost growth and undertake its key structural reforms while restraining inflationary and anchoring the fiscal consolidation would be keenly looked up to in the forthcoming Budget, he added.
