India Climbs In Global Business Optimism Index Report
India’s ranking in the terms of business optimism has improved by one spot on the back of policy reforms including the expected implementation of Goods and Services tax (GST) according to a report released by advisory firm Grant Thorton.
The latest Grant Thornton International Business Report has India ranked in second place on the optimism index for the quarter of July-September 2016. The top position was taken by Indonesia while the Philippinesis placed at the third spot. India had been placed third in the April-June Grant Thornton report.
In a statement, Harish H V Grant Thornton India LLP Partner India Leadership Team said
The improvement in the optimism ranking in the recent past clearly reflects that the reform agenda of the government and its efforts on improving the climate for doing business are having an impact
Harish pointed out that the efforts taken by the government to build relationships with global economic powers as well as the various programs undertaken for boosting economic growth was paying off and making India a bright spot in the global economy. He further added the recent push by the Central government to rollout GST was heightening optimism regarding India’s business prospects.
However the country is still seen to be mired in excess regulations and red tape. India has been regularly placed among the top five countries which are seen to suffer constrained growth due to this. However, for the first time this year the country went from second position to fourth, indicating improvements.
According to the survey, 59 percent of the respondents named red tape as a reason for hindering growth for the country as opposed to 64 percent in the previous quarter. The report was based on a global survey of 2,500 businesses across 36 countries conducted on a quarterly basis.
India has however dropped in terms of revenue expectations. It ranked third, dropping from its first place last quarter. Nonetheless it is still doing better than China where only 30 percent of those surveyed believe revenue will increase compared to that 85 percent that believe India will see increased revenue.
The survey further highlights that 68 percent of the respondents expect selling prices to rise in India while only 10 percent respondents expect a rise in China. Globally this parameter is at 19 percent. Overall, net business optimism is at 33 percent a rise of 1 percent over last quarter but a sharp fall of 11 percent over same period last year. Grant Thornton Global CEO Ed Nusbaum attributed global events like the Brexit and the contentious U.S. Presidential election for the drop in optimism.
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