India's Business Confidence Index Shows Steady Growth

NEW DELHI: The National Council of Applied Economic Research (NCAER) reports a slight increase in India's Business Confidence Index (BCI) to 139.3 in the fourth quarter of FY2024-25, up from 138.4 in the previous quarter. This indicates a sustained optimism among businesses about the country's economic future.

Key Components of BCI

The BCI is based on four main factors: expectations of overall economic conditions, a firm's own financial position, the current investment climate, and present capacity utilization. Over 50% of respondents remained optimistic across these indicators, though with mixed trends compared to the last quarter.

Mixed Sentiments Among Businesses

While the share of firms expecting improvement in overall economic conditions slightly decreased from 66.3% to 64.7%, optimism about their own financial position remained nearly unchanged at 59.2%. Export sentiments saw a decrease to 57.8%, whereas import expectations rose to 46.1%. Pre-tax profit optimism stayed strong at 65.2%.

Stable Macroeconomic Environment

Despite minor fluctuations, the sustained level of business confidence underscores a perception of a stable and supportive macroeconomic environment in India.