A majority of the respondents said that demonetisation is a positive step towards curbing black money and corruption from the economy, the move did have an impact on their sales.
Overall business confidence index (OBCI) slipped to a four quarter low of 58.2 from 67.3 in the last round, a Ficci report said.
The OBCI slipped to a four quarter low of 58.2 from 67.3 in the last round, which was largely on account of the weakness that has gripped the performance of corporate India on account of demonetisation and their assessment of the current state of economy, Ficci's latest business confidence survey, the OBCI said on Tuesday.
The survey was conducted during the months of December 2016 and January 2017 to capture their assessment of the current situation as well as gauge expectations regarding performance for the period January 2017 to June 2017.
The survey drew responses from about 207 companies belonging to a wide array of sectors.
While a majority of the respondents said that demonetisation is a positive step towards curbing black money and corruption from the economy, the move did have an impact on their sales.
The liquidity shortfall affected day-to-day business operations, while realisations and payments were impacted.
The respondents belonging to sectors such as automobile and ancillary industries, farm based products, construction, mining and cement reported a direct impact on their sector's performance.
Further, while some respondents indicated a time frame of three months for things to normalise, others felt that it could even take about a year. Nonetheless, a majority of them said that things should be back to normal in next six months or by June.
With regard to near term expectations, a note of caution underlined the sentiment of the participants and results pertaining to operational parameters indicate deterioration with respect to most parameters except for exports.
The respondents seemed upbeat about the export prospects. About 54 per cent respondents said they foresee higher exports over the next two quarters. The corresponding number in the previous round was 32 per cent.
This is in line with the improvement indicated in country's actual exports growth seen over the past few months.
Photograph: Fatima El-Kareem/Reuters
Exports to some of the key destinations including America, Europe and Asia have noted an increase, they said.