Outlook Grim, Says India Inc

A large section of India Inc expects things to take a turn for the worse in the near future, as per the findings of the 56th Business Outlook Survey carried out by the Confederation of Indian Industry (CII). The survey relates to forecasts for the period October 2001 to March 2002.

Only 16 per cent of the respondents covered in the survey said that they were more optimistic about the prospects of their company than six months ago. While 40 per cent made flat projections, a whopping 44 per cent said that they were less optimistic about the prospects of their company.

A majority, 51 per cent, of the respondents said that they were less optimistic than six months ago about the prospects of their sector. While 40 per cent expected the future prospects to remain unchanged, only nine per cent expected an improvement.

As per the findings of the survey, 60 per cent of the respondents are not looking at making fresh investments in their existing business units, 21 per cent expect to cut down production in the period under consideration, 74 per cent see a decrease in employment, 35 per cent are looking at a decline in profit margins and 26 per cent have projected a rise in inventory.

The survey covered 215 member companies of CII from the private sector as well as the public sector covering a wide spectrum of industrial sectors.

A use-based classification shows that 34 per cent of the respondents were producers of intermediate goods, 21 per cent manufactured capital goods, 22 per cent produced consumer goods and 10 per cent made basic goods, while 13 per cent were services sector companies.

Commenting on the findings, the survey notes that the determination expressed by the respondents in the previous survey to ride the storm seems to have quitened down.