India Inc's business confidence has fallen sharply and it foresees jobless, slow economic growth in the current fiscal, according to a survey by industry body Ficci.
Half the respondents in the survey believe that GDP growth could be less than 5.5 per cent in 2012-13. India's GDP growth was at 5.5 per cent in the April-June quarter.
Revealing a sombre mood, the index of Ficci Business Confidence Survey in the first quarter of 2012-13 was at 51.8, sharply down from 60.3 in the fourth quarter of 2011-12.
"...net responses with regard to prospect of employment opportunities has turned negative, the first time since the 2008-09 crisis. Thus, the current economic slowdown coupled with a negative growth in the employment prospects, may drive the economy into a jobless slow growth," Ficci said.
As per the survey, 42 per cent of the respondents said investments will remain at the same level in next six months compared with 48 per cent in the last quarter.
It said weak demand continues to be a concern for corporate India and high cost of credit acted as a constraint for 62.5 per cent participants.
"Further, a significant majority of the respondents also indicated that deficient rainfalls have had a clear impact on the performance of their industry."
About 85 per cent of the respondents reported that current drought situation would have an impact on their industry.
The survey said inflation which has been a cause of concern for long time indicated some reprieve which came down to 6.9 per cent in July--the lowest since December 2009.
It said that although inflation has eased somewhat the high consumer price index for industrial workers continues to be high close at 9.86 per cent in July.
"It is high time that the RBI undertakes some measure to put in flagging growth. There is no doubt about the fact that the trade-off between growth and inflation is difficult to balance, nonetheless it has become extremely important to regain the lost growth momentum," it said.