Economy to grow at or over 8 pc this fiscal: CII survey

Chandigarh, Feb 22 (PTI) Reflecting strong growthsentiment among industry verticals, a CII business outlooksurvey has found that 74 per cent of the respondents expectthe economy to grow by 8 per cent or more in 2010-11.

As many as 74 per cent of the respondents expect GDPgrowth of 8 per cent or more as against 61 per cent in theprevious October-December 2010-11 survey, it said.

The CII Northern Region Business Outlook Survey wasconducted across Chandigarh, Delhi, Haryana, Himachal Pradesh,Jammu and Kashmir, Punjab, Rajasthan, Uttar Pradesh andUttarakhand, and included 69 per cent of respondents from themanufacturing sector and 21 per cent from the services sector.

It found the overall business outlook for the currentthree months (January - March 2010 -11) is better than theactual performance for the last three months (October -December 2010).

The survey also looked into expectations on variouselements that build up business confidence in the form ofinvestments, capacity utilisation, sales, production, neworders etc.

"56 per cent of the respondents expect an increase ininvestments during the current three months and capacityutilisation is expected to increase in the current threemonths," it said.

It added 68 per cent of the respondents expect capacityutilisation of 75 per cent or more during the current threemonths as against 42 per cent reporting the same in the lastthree months.

Outlook on exports, which according to experts are crucialfor the country�s economic recovery, seems to be much betterfor the current three months.

Eight six per cent of the respondents expect an increasein volume of exports as compared to only 52 per cent actuallyreporting an increase in the last three months, it said.

The survey also highlighted cost and availability oflabour followed by rising interest rates are the two mostimportant concern areas for the industrial sector.

Cost of labour may be due to shortage of skilledworkforce and implementation of NREGA scheme which has led tosome of the industry witnessing a decline in availability oflabour.

Rising interest rates is the second most importantconcern in this survey indicating expectations of furthermonetary tightening by the RBI,� survey said.