New Delhi, Aug. 22: With prices escalating because of delayed monsoon and rising oil prices, industry is worried that overall economic conditions may worsen. However, for the present and near terms, it seems largely confident of doing well.

A Ficci business confidence survey for the first quarter shows India Inc has started getting worried. “Sudden reversal in the progress of south-west monsoon, crude oil prices hovering at the $48-mark, surging inflation and strong commodity prices” threaten to impart a disturbing cost-push to industry. This could squeeze margins and reduce sales.

Fears of higher interest rates in the near future have also contributed to the perception.

According to the survey, overall performance has remained unchanged over the last six months. While this figure was 96 per cent in the last survey, this time it stands at 93 per cent.

A majority (60 per cent) of the respondents expect their industries to perform “moderately to substantially better” in the next six months.

However, the overall confidence index has fallen from the previous quarter’s 75 per cent to 66 per cent, mainly due to fears on the rising prices.

Sectoral analysis shows that the services sector is optimistic about its current and expected performance.

NCAER report

A National Council for Applied Economic Research (NCAER) report says India Inc’s business sentiments have been dampened during April-July with most of the firms lowering their sales and profit outlooks for the next six months, adds PTI.

India Inc sees no major improvement in the investment climate and hence expects lower job creation and no major hike in wages, NCAER said.