The Business Confidence Index rose to 149.4 in April–June 2025, up from 139.3 in the previous quarter, indicating improved sentiment across all four key indicators tracked by NCAER.
Over 60% of firms expressed optimism across indicators like economic conditions, financial outlook, investment climate, and capacity utilisation, with strong expectations for rising production (78.7%) and domestic sales (79.1%).
Export sentiment improved to 66.5%, and more firms (54.3%) expected an increase in raw material imports, reflecting stronger domestic production activity.
Labour market sentiment remained stagnant, with no change expected in hiring or wage rates over the next six months.
The Business Confidence Index (BCI) rose sharply to 149.4 in the April-June period from 139.3 in the last quarter of 2024-25, according to the Business Expectations Survey of National Council of Applied Economic Research (NCAER).
NCAER in a statement said the BCI is based on four components -- overall economic conditions to improve in next six months, financial position of firms will improve in the next six months, present investment climate and whether present capacity utilisation was close to or above optimal level.
The share of positive responses across the four components remains above 60% in the first quarter and also each component exhibited improving trend compared to the preceding quarter, the statement added.
Majority of respondents expected production (78.7%) and domestic sales (79.1%) to increase in the next six months.
The statement said sentiments about export of final products also improved (66.5%) in the first quarter of the current fiscal year.
Percentage of firms expecting import of raw materials to rise also increased (54.3%) from the preceding quarter (46.1%), signalling a push in domestic production activities, it added.
Regarding sentiments about pre-tax profits, nearly 61% of firms expected them to rise, indicating continued buoyancy.
However, the statement said buoyancy in business sentiments was not reflected in the labour markets that showed signs of stagnation with both sentiments about hiring and expectations of wage rates remaining unchanged over the next six months.
NCAER's Professor Bornali Bhandari, who led the survey, said, "With moderation in costs, firms were more optimistic about the next six months." The quarterly survey was carried out in June, covering 479 companies spread across six cities, the statement added.
