Oct. 26 - The global services office business, Regus, surveyed 11,000 corporate organizations spread across 15 countries, including their extensive networks in China, India, Europe and the United States and concluded that the global recovery is being led by India and not China as commonly thought.
The Regus Business Tracker survey says that while the aftermath of the global economic crisis has been taking time to settle down globally, the Indian market has led the way with economic growth and confidence. The results are also reflected in the form of increased foreign investments and increasing IIP numbers marking strong industrial production.
According to the survey, Indian businesses are expecting to see signs of recovery by March 2010. India is by far the most optimistic of the 15 countries surveyed, surpassing the global average.
India’s corporate outlook on economic recovery coincides with an increase in profits that has also surpassed the international average. An estimated 45 percent of Indian firms increased profits last year compared to 40 percent of companies globally. Additionally, 49 percent of Indian companies experienced an increase in revenues last year, as opposed to 46 percent globally. Among India-based businesses that experienced a decrease, 56 percent expect revenues to rise in 2010.
The survey also indicated that the United States and Germany are likely to witness economic recovery by August next year, while the United Kingdom would rebound by September. South Africa would see the beginning of a significant economic recovery in May, while for Australia, Belgium and Canada it would be in June.
China is not expected to see recovery until July, and this also would be subject to issues concerning renminbi appreciation. France and Mexico would see also see economic rebounds in July, and Spain not until October.
Concerning India, strong expectations have also been echoed by the SME sector, with 85 percent of Indian SMEs anticipating revenue growth in 2010, against 72 percent of larger businesses. It was found that 57 percent of Indian corporations feel that they would see an increase in revenues next year.
Regus’ country head Madhusudan Thakur was quoted by India Times as saying: “The relatively positive prediction from Indian firms has to be tempered with an element of caution, with astute firms remaining tightly controlled in the beginning of next year.”
Chris Devonshire-Ellis, managing partner for Dezan Shira & Associates in India told 2point6 billion:“The outlook in India is positive and most businesses I am speaking to are preparing to recruit staff and are actively expanding marketing and operational budgets for 2010. In China we are still seeing retrenchment, non-replacement of natural loss of employees, and uncertainty over the economic position.”
He adds: “The true fiscal position of China is still unclear and investors remain cautious. We do not see much real growth in China at this moment, while India in contrast seems to be picking up a sustainable head of steam. We are seeing signs of investors in Asia preparing to redirect money from their China budgets to fund expansion in India.”