Backed by police reforms by Modi government and soon to be implemented Goods and Services tax (GST), India has improved its ranking by one spot in a global index of business optimism.
As per the latest Grant Thornton International Business Report, India stood at second place on the optimism index during the third quarter (July-September 2016).
Experts suggest improvement in the optimism ranking is accentuated by government’s efforts to improve the climate for doing business.
The ranking was topped by Indonesia and Philippines stood third.
India was ranked third during the April-June period after being on top for two consecutive quarters.
The rise in employment expectations has also added to high business optimism. In April-June period, India stood second on this parameter. At the same time, profitability expectations also moved up.
“…all the programs and initiatives of the government as well as its focus on building relationships with all major economic powers has made India a bright spot in the global economy,” an expert said.
The recent push for GST is also bound to give a further boost to business optimism.
As per the survey, 59 per cent of the respondents have quoted regulations and red tape as a constraint on growth, which are impacting the growth prospects compared to 64 per cent in the previous quarter.
However, in terms of revenue expectations, India slipped to third position from top in the previous quarter.
In spite of the downturn, India is much ahead of China where only 30 per cent respondents expect an increase in revenue.
Globally, business optimism stands at net 33 per cent, rising 1 percentage point from the previous quarter but falling 11 percentage points over the year.
Earlier, another survey by AC Nielsen, stated that Indians are the most confident about job prospects, personal finance and immediate spending intentions. India’s consumer confidence index jumped by 5 points to 133 in the third quarter of 2016, reclaiming the top spot on the global index. The confidence of Indians was boosted by good monsoons, controlled inflation, festive season and positive economic outlook.