New Delhi [India], October 6 (ANI): The private capital expenditure is expected to improve in the first half of FY 25 as compared to the second half of FY 24, highlighted a survey report by the Confederation of Indian Industry (CII).
It noted that more than half (59 per cent) of survey respondents expect an improvement in private capital expenditure in the first half of FY25 compared to the second half of FY24, which is seen as a positive sign supporting public investment. Public capex had seen an uptick after a slowdown in the first quarter due to elections.
The survey report also added that India’s economic growth has remained resilient despite global challenges and uncertainties arising from global economic and geopolitical conditions.
It noted that this optimism is reflected in the CII Business Confidence Index, which surged to a two-quarter high of 68.2 in the second quarter of FY25 (July-September), up from 67.3 in the previous quarter and 67.1 in the same period last year.
The report also noted that industries have responded positively to increased employment opportunities across various sectors, with nearly half of the survey respondents expecting an improvement in hiring during the second quarter.
“Industry is sanguine on the business sentiments as exhibited by the upward trajectory seen in the CII Business Confidence Index which surged to a two-quarter high in the July-September period. The upcoming festive season portends well for fortifying growth prospects further. That said, the uncertainty in the global scenario persists, necessitating a careful watch on the evolving economic conditions,” CII said.
As per report it identified several key factors driving growth, including improving consumption, especially rural demand, steady monsoon progress, a continued focus on reforms, and fresh signs of private investment.
The report also noted a rise in domestic demand, with more than half of respondents anticipating an increase in sales and new orders in their companies during the July-September quarter. As a result, 46 per cent of respondents expect capacity utilisation in their companies to range between 75-100 per cent by the end of September 2024, a higher proportion than in the previous quarter.
The Reserve Bank of India (RBI) has highlighted that capacity utilisation between 75-80 per cent is a favorable indicator for driving fresh investments in the economy.
However, the survey also revealed some ongoing concerns among businesses, with protracted geopolitical tensions, rising global commodity prices, and weakening external demand identified as the top challenges.
The 128th round of the CII Business Outlook Survey was conducted in September 2024, covering more than 200 firms across various industries and regions. (ANI)
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