Archive · 7 Sep 2026
Indian Industry Confidence Rebounds on Demand, Hiring and Investment
Indian companies became more confident during the second quarter of fiscal year 2027.
They said customers are likely to buy more goods and services.
Many businesses also expect to use more of their factories and equipment.
This could encourage companies to make new investments.
More than half of the surveyed companies plan to hire additional workers.
Many companies also expect their profit margins to improve.
Costs are still expected to rise for many businesses, but some cost pressures appear to be easing.
Companies are also watching for a possible Reserve Bank of India interest-rate cut.
Global trade problems and changing commodity prices remain important risks.
The CII Business Confidence Index rose to 66.0 in Q2FY27 from 60.8 in Q1.
The Expectation Index climbed to 67.7, while the Current Situation Index increased to 62.6.
About 61% of respondents expect domestic demand to rise, and 51.6% anticipate capacity utilization above 80% in H2 2026.
Around 53% of companies plan to increase their workforce, while 42.5% expect profit margins to improve.
Global trade uncertainty, commodity-price volatility, weak domestic demand and uneven monsoons remain key risks.
- Who
- The Confederation of Indian Industry and surveyed Indian businesses; CII director general Chandrajit Banerjee commented on the results.
- What
- Business confidence, demand expectations, capacity utilization, hiring plans and profit outlook improved in Q2FY27.
- When
- The survey covers Q2FY27, or July-September; the outlook considers the following six months.
- Where
- India.
- Why
- CII attributed the rebound mainly to stronger domestic demand, improving capacity utilization and easing disruptions linked to the West Asia war.
Positive Business Outlook
Continuing Economic Risks
Growth and demand
Positive Business Outlook
CII said stronger domestic demand and improving business activity indicate that economic growth is increasingly translating into on-ground activity.
Continuing Economic Risks
Some respondents still identified weak domestic demand as a significant risk over the next six months.
Investment and capacity
Positive Business Outlook
Higher expected capacity utilization could push companies toward fresh private investment as existing capacity approaches its limits.
Continuing Economic Risks
The survey indicates a possible investment trigger rather than confirmed new investment, while external uncertainty could still affect business decisions.
Costs and operating conditions
Positive Business Outlook
Firmer demand and early signs of easing cost pressures are supporting expectations of improved profit margins.
Continuing Economic Risks
About 61.1% of respondents still expect costs to rise, and commodity-price volatility remains a major concern.
- Business Confidence Index
- 66.0 in Q2FY27, up from 60.8 in Q1.
- Expectation Index
- 67.7, up from 60.6.
- Current Situation Index
- 62.6, up from 61.2.
- GDP growth
- India's GDP grew 7.8% in Q1FY27, compared with 6.9% a year earlier.
- Hiring outlook
- About 53% of companies expect to increase their workforce.
- Margin outlook
- About 42.5% expect margins to improve, while 37.4% expect them to remain unchanged.
- Main reported risk
- Global trade uncertainty, cited by 34.3% of respondents.