By Adrija Chatterjee
A chorus of optimism resonated from the ranks of top Indian CEOs, painting a bright picture for local businesses despite a challenging global economic climate.
An overwhelming majority of the 53 chief executives exuded optimism about business sentiment, with 51 percent of them “cautiously optimistic” about business sentiment in India and 47.2 percent “very optimistic”. None of the respondents were pessimistic about the current economic trends in the country.
The survey found that nearly 70 percent of Indian businesses plan to invest in the next six months, with only 9.4 percent of the respondents having no such intentions. Additionally, nearly 21 percent of the CEOs polled were undecided about their investment plans in the next six months.
The optimism in India contrasts with global geopolitical uncertainty and concerns over prolonged economic sluggishness in Europe and the US.
On January 9, the World Bank projected global growth to slow down for a third straight year in 2024, with expectations of 2.4 percent growth, followed by a slight increase to 2.7 percent in 2025 — slower than the 3.1 percent average growth seen in the 2010s. The Bank noted that global growth decelerated to 3 percent in 2022 and further to 2.6 percent in 2023.
Amid the global gloom, the World Bank expects only a slight deceleration in investment in India, bolstered by increased public investment and improved corporate and bank balance sheets.
On December 7, India’s Chief Economic Adviser, V. Anantha Nageswaran, urged Indian companies to embrace global uncertainty for the rest of the decade and start investing rather than waiting for improved demand conditions.
Private sector investment is expected to pick up significantly on the back of stronger corporate and bank balance sheets and the government’s push for capital expenditure. India has been seeking to crowd in private investment by boosting spending on infrastructure projects. Latest official data shows that the government remains on track to meet its full-year record capex (capital expenditure) target of Rs 10 lakh crore for the current fiscal, with the figure for April-October standing at Rs 5.47 lakh crore, or 54.7 percent of the target.
India has held on to the tag of being the fastest-growing major economy in the world, with GDP projected to rise by 7.3 percent in 2023-24 from 7.2 percent in the previous year.
The Moneycontrol survey revealed that 78.4 percent of CEOs reported an increase in orders over the past two years, with only 5.9 percent experiencing no such expansion.
According to the surveyed business leaders, order books have “somewhat” increased during the same period for 15.7 percent of the respondents.
In a positive sign for job seekers, 49.1 percent of Indian companies plan to significantly increase hiring in the coming year, while 32.1 percent of the respondents linked recruitment decisions to market conditions. However, nearly 19 percent of the respondents said that they have no plans to expand hiring over the next year.
Several technology companies, both Indian and global, including Google, Amazon, Flipkart, and Paytm, have announced job cuts in 2024.
According to a report by recruitment platform Taggd, India’s hiring landscape is poised for growth in 2024, with the overall intent for recruitment increasing 19 percent from the previous year led by the manufacturing and automotive sectors, among others. However, the information technology (IT) sector showed a more conservative hiring intent, indicating a 3 percent increase from the previous year, reflecting subdued demand due to evolving industry dynamics.
India’s unemployment rate slowed to 8.65 percent in December from 8.88 percent in the preceding month, according to data from the Centre for Monitoring Indian Economy.