'Industry expectations from new government at 20-year high'

India Inc. has excessive hope from the new government which will come into power post general elections, an industry survey revealed.

According to a survey conducted by Assocham among chief executives across the country, the level of expectations from the upcoming government is the highest in at least two decades.

Expectations are high on several fronts from revival of economic growth to fixing inflation and bringing down interest rates and unemployment within a few months of taking over of the new government.

"The expectation level is soaring by the day among different segments of the economy - stock markets, industry, trade, multilateral institutions and foreign investors," Assocham said in the survey report.

"Heads of the diplomatic missions are also pinning their excessive hopes on the next government as they would like to reinforce their economic ties with India," it said.

"However, there are risks of highly built-up expectations. Any deviations in the election results, contrary to expectations can be very harmful because that can lead to a knee-jerk reaction," the report cautioned.

Most opinion polls predict victory for Bharatiya Janata Party-led National Democratic Alliance (NDA) in the ongoing elections. Results are scheduled to be announced May 16.

Nearly 450 chief executives from different sectors like manufacturing, finance, real estates, banking and IT participated in the survey conducted in March.

The survey covered major cities including Delhi, Mumbai, Bangalore, Ahemdabad, Cochin, Kolkata, Hyderabad, Chandigarh and Dehradun among others.

Though they retained their optimism about India receiving a decisive, strong and stable government, as many as 67 percent of the corporate heads agreed the expectations are excessive, at least on the delivery front.

"The run-up in the stock markets in the last few months is another pointer to a huge level of expectation. Our survey shows that at least in the last 20 years, there was never such level of expectations from a new government," said Assocham secretary general D.S. Rawat.

The survey showed that the expectation level was spread across major sectors of the industry in particular but the maximum optimism was seen among those engaged in financial services, banking real estate and consumer goods.

As many as 54 per cent of the respondents in the survey said though issues like inflation and revival of economic growth will take long, they still expect some major morale-boosting announcements from the new regime in New Delhi in terms of reforms that will promise ease of doing business, unclogging of infrastructure projects stuck for environmental clearances.