01
Mumbai, 11 June, 2013 - India?s economic confidence improved marginally despite uncertainties that has enveloped Asia?s third-largest economy due to prospect of good monsoon, according to a report by global research firm Ipsos.
According to the "Ipsos Economic Pulse of the World" survey, India?s economic confidence increased by 3 points to 66 percent in the month of May compared to the month of April 2013, making it the fourth most economically confident country in the world after Saudi Arabia, Sweden and Germany.
Mick Gordon, CEO of Ipsos in India said, "In India monsoon is key to determine agricultural output, inflation, consumer spending and overall economic growth. Normal rainfall signals growth and prosperity, as higher farm output would rein in food prices and help the government to take steps to cut the fiscal deficit and farm subsidies. A stronger economic outlook can lift sentiment in equity markets, mainly of companies selling products in rural areas, including consumer goods and automobiles."
A normal rainfall will further stabilise growth and development. Agriculture sector which accounts for 17-20 per cent of the GDP, is largely dependent on the rains. So a fall in agriculture has a ripple effect on the economy. With 75 per cent of Indians directly or indirectly dependent on agriculture a good monsoon will boost the output of several commodities, reducing the burden on imports.
As for investors, a normal monsoon can positively impact the stock markets too. It will boost hydroelectric industries and improve the power situation. Raw materials for the industry will get cheaper. Monsoons thus act as an economic lifeline for India.
Only Thirty Six per cent Indian Citizens believe their local economy which impacts their personal finance is good, a sharp drop of 5 points and an optimistic 45 per cent people expect that the economy in their local area will be stronger in next six months.
The online Ipsos Economic Pulse of the World survey was conducted in April 2013 among 18,331 people in 24 countries.
