Indian CEOs most optimistic globally about business, economy

Indian CEOs are the most optimistic lot across the world for their own business as well as for the global economy, even as the overall optimism among business chiefs globally has come down for growth in the next one year.

Davos: Indian CEOs are the most optimistic lot across the world for their own business as well as for the global economy, even as the overall optimism among business chiefs globally has come down for growth in the next one year.

Indian CEOs also top the list in terms of confidence in their hiring plans, longer-term growth outlook and on availability of growth opportunities present today, as per the annual CEO survey of global consultancy PwC, released here on the first day of WEF Annual Meeting 2015.

At 62 percent, the number of Indian CEOs who are very confident about their company's growth in the next one year is up 13 percent from last year and is 23 percent higher than this year's global average (39 percent), the survey found.

Besides, 59 percent of Indian CEOs believe that the global economic growth will improve in the next 12 months ? the highest across the world and much above the global average of 37 percent, PwC said.

Russian CEOs, who were the most confident in 2014, have become the least optimistic this year. Indian CEOs were the most optimistic in 2013 as well (63 percent), but their confidence level came down in 2014 (49 percent) about their own business growth.

Globally, however, CEOs have turned less optimistic about the global economy, although their confidence in growth of their own companies remains stable.

The US has overtaken China as the top target market for growth in the first time in five years.

"Fewer CEOs than last year think global economic growth will improve over the next 12 months," PwC said while citing results of its 18th Annual Global CEO Survey on the basis of responses from more than 1,300 CEOs.

Globally, 37 percent of CEOs think global economic growth will improve in 2015, down from 44 percent last year.

Significantly, 17 percent of CEOs globally believe global economic growth will decline, more than twice as many as a year ago (7 percent).

Regionally, the results show wide variations. CEOs in Asia Pacific are the most optimistic about the global economy, followed by the Middle East and North America.

CEOs in emerging economies like India, China and Mexico are also more optimistic about the economy than those in developed economies like the US and Germany.

Commenting on the India findings, Deepak Kapoor, Chairman, PwC India, said: "This clear and significant spike in CEO confidence in India is encouraging. There has been a palpable uplift in sentiments among Indian corporates and the survey strengthens the belief that corporate India is on the growth path and engaging in the nation building process."

In the longer term, an astonishing 71 percent of India's CEOs are very confident of growth over the next three years, making them the most upbeat in the world on this front too.

In terms of growth opportunities, a massive 84 percent of Indian CEOs believe there are more growth opportunities for their company today than three years ago - once again the highest percentage in the world.

When asked to name the countries most important to them for their growth in the next 12 months, 48 percent of the Indian CEOs named US, followed by China at 26 percent.

A high 77 percent of Indian CEOs also plan to implement a cost-reduction initiative in the next 12 months, while 63 percent plan to enter into a new strategic alliance/joint venture, and a high 51 percent plan to outsource a business process or function.

A massive 73 percent of Indian CEOs (as against 50 percent globally) expect to boost head count in the next 12 months ? the highest in the world.

Besides, only 11 percent plan to reduce their workforce (as against over 20 percent globally).

However, 41 percent of Indian CEOs believe there are more threats to the growth of their company today than three years ago. The top potential economic and policy threats highlighted by them include inadequate basic infrastructure, over-regulation and government response to fiscal deficit and debt burden.

The major business threats include bribery and corruption, high or volatile energy costs and availability of key skills.

When asked to identify disruptive trends, 52 percent said increase in number of direct and indirect competitors, and 51 percent named changes in industry regulation.

When asked from which other industry sector do they see a significant competitor emerging, 27 percent said technology, and 25 percent said none.

A massive 82 percent of India's CEOs thought a priority of government should be to ensure an adequate physical infrastructure, and 68 percent thought their government had been ineffective in achieving this.

In the survey, a major of CEOs also said the government should ensure an internationally competitive and efficient tax system, while 60 percent thought the government had been ineffective in achieving this.

When asked to identify areas where they were seeing changes in international policies and regulations, a majority cent said improved regulatory coordination is increasing cross-border capital flows, while many cent said governments are increasingly implementing more competitive tax policies.

Despite the overall declining outlook for the global economy, CEOs globally remain confident about prospects for their own company with 39 percent worldwide saying they are 'very confident' their company's revenue will grow in the next 12 months. This is the same as the last year, though up slightly from 36 percent in 2013.

Commenting on the survey results, Dennis Nally, Chairman of PricewaterhouseCoopers International, said, "The world is facing significant challenges: economically, politically and socially.

"CEOs overall remain cautious in their near-term outlook for the worldwide economy, as well as for growth prospects for their own companies."

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