A CEOs snap poll conducted by Confederation of Indian Industry (CII) revealed that Investments during the current financial year would be on track.
This was revealed by 89 percent of the CEOs who expected investments to be on track in their companies during the current financial year 2007-08.
Responding to the impact of sub-prime crisis on India, 57% percent of the CEOs felt that the crisis would impact portfolio inflows for the current year and the CEOs were indifferent to the impact of the sub-prime crisis on FDI inflows.
The snap poll also revealed that majority of the CEOs expected no impact of sub-prime crisis on domestic interest rates.
However, CII feels that high interest rates are a cause for concern and majority of the CEOs expect that the Interest rates should be reduced to encourage greater investment rates.
Given that Inflation is under control, the CII CEOs snap poll revealed that 69 percent of the CEOs expected the interest rates to be lowered to about 12% (PLR) from the current level of 13.25%.
According to CII, India would need investment rates in excess of 36 percent of GDP to increase the GDP growth to 10 percent.
On the exchange rate front, CII CEOs snap poll revealed that exchange rate of the Rupee for the US $ would stabilize and 87% of the CEOs expected the median exchange rate to be around Rs .40. Increasing trade deficit is expected to maintain the exchange rate around the current levels.
Confederation of Indian Industry
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