Bikky Khosla | 23 Mar, 2021
Business confidence has just started picking up, if we go
by the findings of some recent surveys. Covid-19 hit the Indian economy hard,
but with the situation improving and roll-out of country-wide vaccination
programs, our entrepreneurs have become optimistic about financial performance
of their own business and the overall economy in the days to come. While all
these sound like a big relief, Covid-19 statistics of the last few weeks seem
to be a big dampener.
Dun & Bradstreet's composite CFO Optimism Index
for January-March posted an increase of 23.6 percent. With this, the optimism
has touched almost the pre-Covid level during the corresponding quarter last
year when it was 123.5. Over 350 CFOs were surveyed. Views were sought on
twelve parameters, including liquidity position, operating margin, etc. and it
was found that the optimism level increased 14.4 percent in the industrial
sector and 27.4 percent in the services sector.
Similarly, a recent FICCI survey finds
the business confidence index at a decadal
high. It stood at 74.2 in the
current round, against the index value of 70.9 reported in the previous survey
and 59 reported a year back. Nearly 27 percent respondents expect an increase
in selling price of their products over the next six months.
Again, another survey shows that the manufacturing sector is expected
to regain the lost momentum in the fourth quarter. Exports prospects were also
reported to be better.
But while everything seems to be going
fine at the surface, it is now widely feared that a surge in coronavirus cases
in the country in recent weeks could hurt the Indian economy's recovery. The
number of infections have risen, forcing authorities to
clamp partial lockdowns in several places. The Centre has so
far been reluctant to take any harsh step, but if the
resurgence of Covid-19 continues, it could soon have no way out. A better
solution must be found.
invite your opinions.