India’s economic landscape is increasingly favorable for private investments, with the nation emerging as a “bright spot” amid global challenges, according to a recent survey conducted by the Confederation of Indian Industry (CII). The interim findings indicate that 75% of businesses believe the current environment is conducive to private investment, while 97% of surveyed firms are likely to expand their workforce in the coming financial years.
Positive Sentiments on Employment and Investments
The survey, covering 300 firms of various sizes across industries, revealed that a significant majority—79%—have already expanded their workforce over the past three years. Moreover, with 70% of firms planning to invest in the financial year 2025-26, an increase in private investments is anticipated over the next few quarters.
CII Director General Chandrajit Banerjee highlighted that despite geopolitical uncertainties disrupting global supply chains and economic growth, India's sound economic policies, particularly those emphasizing public capital expenditure, have helped the country remain resilient and attractive for investments.
Employment Growth Prospects
The survey predicts a 15-22% increase in direct employment across manufacturing and service sectors in the next year, with indirect employment expected to rise by around 14%. However, firms noted challenges in hiring senior and managerial-level staff, typically taking 1 to 6 months to fill such positions, while junior and contractual roles are filled faster.
Wages and Consumption Trends
In terms of wage growth, 40-45% of surveyed firms reported an increase in salaries for senior management, managerial, and regular employees by 10-20% in the current financial year, reflecting a steady upward trend from the previous year. This rise in wages is expected to have a positive impact on personal consumption levels.
Economic Growth Outlook
With private investments and employment trends showing positive momentum, the CII anticipates India’s GDP growth to remain stable at 6.4-6.7% in the current fiscal year, potentially reaching 7% in FY26. Banerjee emphasized that these trends demonstrate confidence in India’s economic fundamentals, further bolstered by emerging macroeconomic indicators.
The final results of the survey, which will encompass responses from 500 firms, are expected to be published by the first week of February.
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