India story looks better this year

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India is fifth most attractive market for investments, up one notch compared to previous year

India has climbed one spot to become the fifth most attractive market for investments and business optimism is at record high levels globally even as cybersecurity and climate change have become areas of concern for CEOs, says a survey.

According to the annual global CEO survey by consultancy giant PwC, released in Davos, at the WEF annual meeting recently, India has bumped Japan as the fifth most attractive market in 2018. In 2017, India was in the sixth position.The top market was the US, favoured by 46 percent of global CEOs, followed by China (33 percent) and Germany (20 percent) at the second and third place, respectively. At the fourth spot in the UK (15 percent) and India at the fifth place with 9 percent.

PwC India chairman Shyamal Mukherjee said backed by definitive structural reforms, the India story has been looking better in the past one year. “Most of our clients are optimistic about their growth. The government has made efforts to address concerns around areas like infrastructure, manufacturing and skilling, although newer threats like cybersecurity and climate change are beginning to play on the minds of our clients,” he noted.

As per the report, despite the rising optimism, anxiety of CEOs are also increasing on a much broader range of business, social and economic threats. Around 40 percent of CEOs are ‘extremely concerned’ about geopolitical uncertainty and cyber threats while 41 percent feel so about terrorism. Other factors for concerns are the availability of key skills (38 percent) and populism (35 percent). “These threats outpace familiar concerns about business growth prospects such as exchange rate volatility (29 percent) and changing consumer behaviour (26 percent),” the survey said.

Further, terrorism is seen as among the top ten threats to growth whereas only 20 percent felt so in 2017. “The threat of over-regulation remains the top concern for CEOs (42 percent extremely concerned), and over a third (36 percent) remain concerned about an increasing tax burden,” it added.

Climate change and environmental damage are reported among the top five threats for businesses in the Asia Pacific and Western Europe. It is also recognised as a top five threat to the growth prospects of companies in the energy and utilities, engineering and construction, transport and logistics sectors.

Asked if globalisation has helped ‘close the gap between the rich and the poor’, nearly 40 percent of CEOs responded “not at all”, while 30 percent said globalisation had not helped ‘avert climate change and resource scarcity’. More than one in four CEOs say that globalisation has not helped improve the ‘integrity and effectiveness of global tax systems’ at all.

PwC conducted 1,293 interviews with CEOs in 85 countries between August and November 2017.

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