Indian business optimism climbed to its highest since 2010, as a significant majority expects revenues to rise and profitability to get a boost in the next 12 months, says a report.
Businesses in the country are optimistic about their growth prospects as the country gears up for an election which is expected to return a more business-friendly administration, the report by global consultancy major Grant Thornton said.
At 89 per cent, optimism amongst Indian business owners remains well ahead of the global average of 44 per cent.
This optimism is driven by the fact that 92 per cent of Indian businesses expect their revenues to rise in the next 12 months while 87 per cent believe their profitability will get a boost.
Hope of a stable government and significant reduction in the rupee volatility has also boosted the optimism level, the report said.
While optimism has risen on several fronts, there are certain constraints being felt by businesses globally.
Rising energy cost is another pressing constraint, besides other factors such as shortage of finance, regulations/red tape, and lack of skilled workers.
Economic uncertainty remains a key constraint; however, the proportion of businesses globally citing this as a constraint to growth is down from 42 per cent to 38 per cent over the past three months.
"Appreciation in the rupee, dramatic reduction in the gold imports, stock markets near life time highs and improved forecasts for medium term GDP growth have all helped boost business optimism," Grant Thornton India National Managing Partner Vishesh Chandiok said.
Chandiok further said that "however the new regime will have its task cutout to demonstrate impact in the short term for the above to sustain or else sentiments will go down as quickly as it has improved."