WALKING ON EGGS

BT'S BUSINESS CONFIDENCE INDEX SHOWS RISING CONFIDENCE IN THE QUARTER GONE BY, AND EVEN MORE CONFIDENCE FOR THE COMING QUARTER. BUT WITH SEVERAL CHALLENGES STARING COMPANIES IN THE FACE, THE ASSURANCE COULD CRACK

- ALOKESH BHATTACHARYYA

TRY WALKING ON a bed of burning coal. Or a sheet of very thin ice. You feel exhilarated. Thrilled. You also feel frightened. Any slip would mean serious trouble. Yet, till that happens, you are on a high. That seems to be the emotion seeping through the latest edition of the BT-C Fore Business Confidence survey. On the face of it, the Indian economy has powerful headwinds battering it—inflation at high levels, the war in Ukraine leading to commodity price surges, Covid-19 just refusing to go away, questionable demand, falling productivity, rising fuel prices—one could go on.

Yet, we have a situation where despite the obvious challenges, businesses are not just hopeful, but positively, well, positive. That sentiment comes through in BT’s Business Confidence Index or BCI for Q4 of FY22, which finds itself at 55.2, a peak that was scaled as far back as Q2 of 2014-15 and Q4 of 2011-12, when it had hit 55.4. This time, the index scaled 50+ across all segments of the industry (services, light industry, and heavy engineering) and all sizes, from big- to micro-sized businesses. Overall, the BCI survey respondents gave ratings above five (on a scale of 10) to every parameter for Q4 of FY22—overall economic conditions, the financial situation of the companies, demand conditions, hiring conditions, and profit margins (see charts).