Why corporate India's confidence levels are low

The GDP numbers for the three months to June 2011 threw up a pleasant surprise; fixed capital formation rose a smart 7.9 per cent year-on-year (y-o-y) from a low of 0.4 per cent y-o-y in the March quarter. However, since the fixed capital formation numbers for the June 2010 quarter were revised sharply downwards from 17.4 per cent to 11.1 per cent, the growth has happened on a much lower base. Nonetheless, data from CMIE corroborates the trend, showing a slight recovery in new project announcements during the quarter.

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