New Delhi, Set 4 (IANS) Uncertainty in the global economy increases the production costs and high interest rates led to a decrease of corporate confidence in the second quarter of fiscal year according to one study, the Confederation of Indian Industry (CII).
According to the CII,Quarterly Business Outlook Survey, the business confidence index for the second quarter of 2011-12, fell by 8.9 points compared to a decrease of 4.2 points last quarter.
The survey was conducted during the month ending in mid-August and is based on the sample of 250 companies.
CII poll shows effect of global economic recession and internal factors, which make up about future economic prospects? Said Chandrajit Banerjee, Managing Director, CII.? However, expectations for the second quarter suggest a modest recovery? he said.
Business confidence index is constructed as a weighted average of the current situation (CSI), and the expectations index (EI), which the defendants? to evaluate the performance of their company, industry and economy, fourth, and hope for the next quarter.
CSI com a couple of the current situation re-port from the previous quarter, while NOT reflect the expectations of respondents in the current quarter compared to last quarter.
During the quarter ending in September, CSI decreased by 9.9 points, while the AE slipped 8.4 points.
When asked about the prospects for economic growth in 2011-12, the majority of respondents (29 percent) said they expect gross domestic product (GDP) to moderate from 7.5 to 8.0 per cent to around 23.7 per cent, when it said, is between 8 to 8.5 per cent.
"The majority of respondents (55.6 percent) expect inflation to average more than 8 per cent in 2011-12, while only 9.9 percent expect it to be between 6-7 percent," said the IIC in a statement.
Around 78 per cent and 50.6 per cent of the company's industry and services, respectively, experienced a total increase in input costs in the first quarter of 2011-12, and most are expected to remain high, he added.
The big concern, who was born in the study, most companies are not going to increase the investment plans in the second quarter.
"While most companies are planning to increase spending on capacity expansion in the previous survey, the current study shows that the vast majority of businesses expect no change in consumption," said the IIC.
According to the CII,Quarterly Business Outlook Survey, the business confidence index for the second quarter of 2011-12, fell by 8.9 points compared to a decrease of 4.2 points last quarter.
The survey was conducted during the month ending in mid-August and is based on the sample of 250 companies.
CII poll shows effect of global economic recession and internal factors, which make up about future economic prospects? Said Chandrajit Banerjee, Managing Director, CII.? However, expectations for the second quarter suggest a modest recovery? he said.
Business confidence index is constructed as a weighted average of the current situation (CSI), and the expectations index (EI), which the defendants? to evaluate the performance of their company, industry and economy, fourth, and hope for the next quarter.
CSI com a couple of the current situation re-port from the previous quarter, while NOT reflect the expectations of respondents in the current quarter compared to last quarter.
During the quarter ending in September, CSI decreased by 9.9 points, while the AE slipped 8.4 points.
When asked about the prospects for economic growth in 2011-12, the majority of respondents (29 percent) said they expect gross domestic product (GDP) to moderate from 7.5 to 8.0 per cent to around 23.7 per cent, when it said, is between 8 to 8.5 per cent.
"The majority of respondents (55.6 percent) expect inflation to average more than 8 per cent in 2011-12, while only 9.9 percent expect it to be between 6-7 percent," said the IIC in a statement.
Around 78 per cent and 50.6 per cent of the company's industry and services, respectively, experienced a total increase in input costs in the first quarter of 2011-12, and most are expected to remain high, he added.
The big concern, who was born in the study, most companies are not going to increase the investment plans in the second quarter.
"While most companies are planning to increase spending on capacity expansion in the previous survey, the current study shows that the vast majority of businesses expect no change in consumption," said the IIC.
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