The NCAER’s 101st Round of the Business Expectations Survey (BES) shows that the Business Confidence Index (BCI) fell by 2.5 per cent in July 2017 over April 2017 on a quarter-to-quarter basis. The composition of the BCI is based on four components having equal weights. The decline in BCI was driven by deterioration in three out of four indicators on (i) present investment climate, (ii) overall economic conditions in the next six months and (iii) the financial position of firms in the next six months. One component showed an improvement, with percentage of firms perceiving that ‘present capacity utilization is close to or above optimal level’ going up from 91.6 per cent in April 2017 to 97.1 per cent in July 2017.

The Government has undertaken many structural reforms to increase the confidence of the industry including simplification of the process of applying for Industrial License and Industrial Entrepreneur Memorandum by making it available online on 24x7 basis at the eBiz website, integration of twenty services with the eBiz portal which functions as a single window portal for obtaining clearances from various Government agencies, automation of registration with the   Employees Provident Fund Organization and Employees State Insurance Corporation etc. As a result of these steps, India improved its rank to 100 from 130 in the World Bank’s Ease of Doing Business Report, 2018.

The Economic Survey gives the detailed analysis on the state of the economy, along with important developments during the year.

This was stated by Shri Pon. Radhakrishnan, Minister of State for Finance in written reply to a question in Rajya Sabha.

Business confidence falls as three indicators weaken amid government ease of doing business reforms reported in national business survey. The Business Expectations Survey shows a quarter to quarter decline in the Business Confidence Index driven by worsening assessments of the present investment climate, expectations for overall economic conditions over the next six months, and anticipated financial position of firms, while perceptions of capacity utilization improved. The note links this sentiment to governmental structural reforms-online licensing, a single window eBiz portal, and automated social security registrations-cited alongside improved ease of doing business rankings and the national Economic Survey.