India’s premier business association, CII at 68th Business Outlook Survey said that the Business Confidence picked up for October – March 2007-08 after a decline during the period April-September 2007-08.

CII’s business confidence index for October-March this fiscal, at 66.3, has witnessed a marginal increase of 2.4 points from April-September 2007. However, the index was down by 5.5 points when compared to the corresponding period last year.

The current situation index that compares current business conditions has witnessed a marginal increase of 0.2 points compared with the previous six months. When compared with the corresponding period of the previous year, the situations index is down 6.3 points.

The CII business confidence index (CII-BCI) showed the current situation index (CSI) and expectations index (EI) was higher among non-manufacturing firms as compared to manufacturing firms.

The survey reveals that GDP growth for the year 2007-08 is expected to be around 9% according to 59% of the respondents, while 22% of the respondents expect the GDP growth to be in the range of 9 - 9.5%, much above the government and RBI figures.

The CII survey, which involved over 190 member companies across sectors, revealed that about 87% of the respondents expressed plan to increase investments during October-March, 2007-08. It also revealed that 45% of the respondents expect the inventory levels to increase.

Survey found that around 82% of the respondents expect further increase in production during next six months on the back of increase in new orders. The value of production is also expected to increase in the next six months.

CII said in a statement, “Despite a surging rupee against the weakening dollar, exports would continue to increase. However, the sector continues to face procedural delays, which acts as long-standing hurdle for exporters, which raises transactions costs and needs to be addressed urgently.”