Indian economy witnessing good, better, best conditions

New Delhi, May 15 (UNI) The current overall performance of the Indian economy was better as compared to the last six months, and will further improve in the next six months, according to a Business Confidence Survey (BCS) survey.

''Over 81 per cent of the 439 companies surveyed by BCS felt that the Indian economy would perform much better in the next six months, while a majority 85 per cent felt that the current overall economic conditions are 'moderately to substantially' better as compared to the last six months,'' the survey conducted by the Federation of Indian Chambers of Commerce and Industry (FICCI) said.

The BCS for the last quarter of 2005-06 covered 439 companies with turnover ranging from Rs 1 crore to Rs 89,000 crore across sectors like pharmaceuticals, textiles, telecom, food and beverages, heavy equipment and machinery, financial services, IT, BPO, travel and tourism, auto and auto ancillary, construction and real estate, steel, cement and petrochemicals.

At the firm level, 74 per cent of the respondents rated their performance as 'moderately to substantially better' vis-a-vis the last six months, while 20 per cent reported to have sustained their level of performance.

The key areas of concern were the rising cost of raw materials, with nearly 70 per cent of the companies reporting it as a constraining factor.

Nearly 38 per cent of the companies, which participated in the study planned to increase their selling price in the coming six months, as compared to 15 per in in FICCI BCS Q1 2005-06.

The growing domestic and export demand conditions have resulted in improvement in the capacity utilisation levels of over 75 per cent of the companies.

Another important point noted by the study relates to the recruitment plans of the participating companies. With a significant 42 per cent of the companies reporting 'higher to much higher' employment in the next six months the demand for talent is only going to further rise in the market.

Interestingly, while companies from the services sector have been at the forefront when it comes to recruitment, the results of the present survey show that a large number of manufacturing companies are also drawing up plans to add to their employee strength.

Summarising the report FICCI President Saroj Kumar Poddar said, ''The overall current condition is very optimistic and stable, which is a record. Our policy should be now to sustain this momentum.'' UNI CS RA GC1725