Chennai, Mar 13: Indian Small and Medium Scale Enterprises (SMEs) are among the most optimistic in Asia, with 58 per cent expecting local economic growth to accelerate in the next six months, according to a HSBC Asia-Pacific Small Business Confidence Survey. Talking to newspersons here today, HSBC Head (SME) Bhuvnesh Khanna said the survey by the market research company TNS covered 2,736 SMEs across nine Asia Pacific countries, including India.
Companies were asked about their local economic outlook for the next six months, their plans to increase or reduce capital investment and staffing levels and their expectations about trade volumes with China, the rest of Asia and the rest of the world, he added. Mr Khanna said Indian small businessess were next to Vietnam in their optimism. ''The majority (58 per cent) expect local economic growth to increase, 38 per cent expect the economy to maintain the same pace in the next six months as in 2007 and a mere four per cent expect a slow down,'' he said.
He highlighted that small businesses in Vietnam and India were acting on their positive economic outlook with increased capital investment in the first half of 2008.
In India, the survey covered 333 SMEs in Chennai, Mumbai, Delhi and Kolkata. The survey said about 68 per cent of Indian SMEs plan to increase their capital investment, while 38 per cent plan to maintain it at the same level as last year and only two per cent propose to decrease it compared to 2007.
On recruitment plans, the survey indicated that in India, 57 per cent of the respondents would maintain staffing levels, while 43 per cent plan to hire more workers. None proposed to cut jobs.
About cross border trade, it said that while at the moment Indian SMEs were relatively less involved in cross border trade, they expect it to increase significantly this year.
SMEs in Vietnam and India were the most optimistic about trade growth with China as well as with the rest of Asia. In India, about 60 per cent SMEs said they expect trade with China to increase, while 30 per cent said it would remain unchanged. About ten per cent expect it to decrease.
Majority Indian SMEs (70 per cent) felt that trade with the rest of the world would increase, while the rest expect it to remain the same.