India Economy Growth Survey 2011-1012: Market Segmentation - PSB


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India’s top managers surveyed on their plans for growth in 2011 and the priorities they believe the Finance Minister should set in his budget. The vast majority of those surveyed expect at least the current economy growth rate to continue, or to grow faster.

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India Economy Growth Survey 2011-1012: Market Segmentation - PSB

  1. 1. THE PULSE OF INDIA INC.India Inc. is confident about theeconomy and has aggressive growthplans. The vast majority of thosesurveyed expect at least the currentgrowth rate �7�8�� to continue, or togrow faster. And India’s business eliteshave global and local expansion plans,with a new investment horizon of 6�12months, with corresponding aggres�sive hiring plans to support expansionand growth, even while global recov�ery continues to move slowly.Indian managers believe that therevival of the economy’s agricultureand food sector should be top priorityin the 2011�2012 budget. Otherpressing issues include industrialgrowth, transparency & publicaccountability, infrastructure & realestate, and fiscal consolidation &monetary discipline.However, India Inc. is divided whenit comes to the Financial Ministry’sability to deliver on reforms promiseddue to coalition politics.74% of respondents areMORE CONFIDENTabout the growth ofthe Indian economy ascompared to last year.68%of Indian managersplan to expand74%India’s top managers surveyed on their plans for growth in 2011 -- and thepriorities they believe the Finance Minister should set in his budgetCONFIDENCE IN ECONOMYFUELS INDIA INC.’S AMBITIONS90%BELIEVE THAT THE ECONOMYWILL GROW AT A RATE OF 7% ORMOREGLOBALLY LOCALLYof Indian managersplan to expandA PENN SCHOEN BERLAND - BLOOMBERG UTV POLLPLAN TO REDUCE THE SCALEOF THEIR OPERATIONSJUST 2%127PHONE INTERVIEWS AMONGCEOS, CFOS, Vice Presidents,Heads of Business Units, GeneralManagers and Senior ManagersBASED ON
  2. 2. 010203040504646KEY CHALLENGES TO INDIAN ECONOMYYES, IN 12MONTHSYES, IN 6MONTHSNO, WEARE NOTYES, AFTER2 YEARSDON’TKNOW0102030405042% 39%8%5% 5%25%30%39%MAYBE/MAYBE NOT YES, IT WILLNO, IT WILL NOT6%DON’T KNOWOf managers who plan to expand, 45% planto infuse fresh capital locally, 21% plan toacquire companies, 21% plan to seek FDI.CORRUPTIONFOODINFLATIONINFRA-STRUCTURERISINGSUBSIDIES49%35%30%24%15%POORGOVERNANCE22%46%30%1%EXPANDING BOTH WAYSEXPANDING GLOBALLYEXPANDINGLOCALLYDON’T KNOWCreating jobs and hiring talent in the next year:67% plan to hire more people, 34% will en-hance compensation/increase salaries;however, 21% will rationalize headcount.Managers planningexpansion are lookingboth locally and globallyWILL COALITIONPOLITICS ALLOW THEFM TO DELIVER HISPROMISED REFORMS?INDIA INC. PLANS FRESH INVESTMENTS
  3. 3. INDIA INC.’S TOP PRIORITIES FOR BUDGET 2011India Inc. believes that tomanage High Food inflation,the Finance Minister mustextend easy credit support tofarmers & find ways toreduce wastage of foodsupplies besides providing afillip to industrial sectorthrough access to credit,while making tax laws moretransparent, creating reformadvisory groups, andevaluating programmeimplementation to managethe governance deficit andimprove transparency.India Inc. believes that thebest ways to manage theFiscal Deficit are toimplement GST, introducethe Direct Tax Code &allowing FDI in sectors suchas retail, and raising caps insectors such as insurance.01020304050FOOD SECTORREVIVALINDUSTRIALGROWTHTRANSPARENCY& ACCOUNTABILITYINFRASTRUCTURE& REAL ESTATEFISCAL & MONETARYDISCIPLINECAPITAL FORMATION& FDIRESOURCE MOBILIZATION& BETTER TAXATIONENSURING ENERGYSECURITYSOCIALSECTOR45%27% 27%24%21%21%14% 13%13% 12%8%33% SUPPORT EASY CREDIT SUPPORT FOR FARMERS 59% SUPPORT CREDIT EXPANSION TO INDUSTRIAL SECTORON INDUSTRIAL GROWTH...52%SUPPORT GREATER INFRASTRUCTURE INVESTMENTTO REFORM INFRASTRUCTURE...32% SUPPORT TAX LAW REFORMTO INCREASE TRANSPARENCY...ON THE AGRICULTURAL SECTOR...
  4. 4. 0 10 20 30 40 50 0 10 20 30 40 500 10 20 30 40 50 600 5 10 15 20 25 3041% SUPPORT A GOODS AND SERVICES TAXTO ENFORCE MONETARY DISCLIPLINE...50% CALL FOR ALLOWING FOREIGN DIRECT INVESTMENTTO SUPPORT CAPITAL FORMATION...40% SAY RENEWABLE ENERGY MUST BE DECENTRALIZEDENERGY SECURITY44% SAY IMPLEMENT A GOODS AND SERVICES TAXTO FURTHER RESOURCE MOBILIZATION...BREAKING PRIORITIES DOWN BY SECTORMANUFACTURING SERVICES ENERGY & INFRASTRUCTURE IT & TELECOMAGRICULTURE & FOOD SECTOR REVIVALPUSHING INDUSTRIAL GROWTHTRANSPARENCY & PUBLIC ACCOUNTABILITYFILLIP TO INFRASTRUCTURE & REAL ESTATE SECTORSFISCAL CONSOLIDATION & MONETARY DISCIPLINECAPITAL FORMATION & FOREIGN DIRECT INVESTMENTRESOURCE MOBILIZATION THROUGH BETTERENSURING ENERGY SECURITYSOCIAL SECTOR & INCLUSIVE GROWTH43%35%27%27%22%30%27%27%27%27%60%33%17%33%17%50%33%27%20%20%Penn Schoen Berland��, amember of the Young &Rubican Brands and WPP is aglobal research�based commu�nication advisory thatspecialises in messaging andstrategy for blue�chip corpo�rate, entertainment andpolitical clients. Rooted inmarket research, we have over30 years of experience ingenerating unique insightsabout public opinion, providingclients with actionable ideasthat give them a competitiveedge.We call it .If you would like to use theservices of Penn Schoen Berland,please send an email to:Shefali KhannaDirector Marketing, South