Last Updated: 4/11/2017 2:38:00 AM
Economic growth slipped to a nine year low of 6.5% last financial year, but India Inc fears further deceleration in the GDP expansion during 2012-13, shows a survey. Industry wants the government to unleash a slew of policies to perk up the economy facing adverse circumstances.
In the survey conducted by the Confederation of Indian Industry 43% of 110 respondents felt that India's GDP growth would fall below 6.5% but would not go below 6%, while 40% of them expected it to nosedive to less than 6%.
Only 13% of respondents were optimistic that the economy would grow in the range of 6.5 to 7% and just 5% expected the GDP to expand in the range of seven to 7.5%. Some of the respondents would be common, so the sum total has exceeded 100%.
CII said that the survey was conducted in various sectors of the economy which together contribute to 50% of the country's production.
The majority of senior industry leaders expected their top line and bottom line growth to decline and in some cases it was expected to be negative.
CII in the survey said that “About 43% of the respondents expected net sales growth to stagnate or decline during the year 2012-13. Similarly, 57% of the senior industry leaders expected the bottom line growth to either stagnate or decline. This clearly indicates that there will be pressure, leaving less room for capital expansion.”
On expanding investment, 32% revealed expansion plans in their companies would continue to be at the same level as compared with last year, while 29% of them said there would be contraction in expansion plans domestically.
On investment abroad, 47% of them said their preference was to maintain the same levels as in the last year, while 43% of them expected to increase investments overseas.
A majority of around 50% respondents saying that the hiring activities in the current fiscal would remain stagnant
To contain the worsening economic situation, the CII called for a comprehensive revival package. The industry lobby group asked for a cut of 100 basis points in repo rates as well as in the cash reserve ratio. The Reserve Bank is slated to come up with its policy review on June 18.