64% of Indian businesses will seek funds in a year: survey

Mumbai, Oct 17 (UNI) Around 64 per cent of businesses in the country will seek funds within a year's time, while 61 per cent of Indian businesses propose to raise funds through local banks, revealed the Grant Thornton's International Business Report 2007.

The survey conducted recently had quizzed over 500 business owners with a currency range of 100-500 crores, across seven major markets in the country, about their fund raising plans to fuel their business growth.

The rest of the businesses will look at raising funds either by way of private equity, strategic investment, public issue, foreign banks and flotation of local or overseas markets, the report stated.

The other issues identified in the survey were considered as either factors or deterrents for economic and business growth. These include labour laws, availability of managerial talent, quality of infrastructure, governance and bureaucracy, 'Made in India' tag, availability of technology, existing tax and duty structure, availability of finance, liberalisation of the Indian economy, and convertibility of the Indian Rupee on trade account.

Some 53 per cent respondents felt that infrastructure was not a deterrent to their business. When asked about the quality of infrastructure as against that of the rest of the world, a large number felt that there has been considerable improvement in the infrastructure in the recent times.

On the whole, India presents itself as a strong base for businesses, in comparison to the rest of the world. The labour laws ensure a good degree of satisfaction in the workforce. Again 53 per cent of the respondents felt that the there is a significant pool of managerial talent available in India, the report said.

The liberalisation in the Indian economy has, in turn, granted access to newer technology from other countries. More than 55 per cent of the respondents felt that access to technology is easily available and is not a deterrent.

Overall, the survey showed a positive attitude amongst business owners as only three out of 11 factors show a negative weight while the rest eight have a positive or neutral influence. Almost 44 per cent of the respondents felt that the tax and duty structure was not fair and proved a hindrance to enhancing economic and business performance.

However, the respondents also felt that it is the structure for tax and duties in India and not the quantum that can be considered an impediment. At the same time, more than 75 per cent were against a uniform flat corporate tax rate. Similarly, almost 75 per cent of the respondents were against a uniform flat individual tax rate.

Corruption has been rated as the biggest impediment to economic growth, around 35 per cent of the respondents felt that this was a serious impediment to business performance and economic growth, the report added.

UNI