Business outlook brightens: CII Index at five-quarter high

New Delhi: Rising for the third consecutive quarter, CII’s Business Confidence Index climbed to a five-quarter high of 66.5 in Q3 FY26, driven by optimism around demand, profitability, and investment conditions, the industry lobby said on Sunday.

Domestic demand remains the key driver, with two-thirds of firms reporting higher demand in Q2 FY26 and 72 per cent expecting further growth in Q3 FY26, aided by GST rate cuts and festive consumption, the industry body said in the survey. CII-Business Confidence Index (BCI) is based on a sample survey of firms covering all industry sectors, including micro, small, medium, and large enterprises, from different regions. The survey also enumerated responses across industry groups, both in the public and private sectors, engaged in the manufacturing and services sectors. It was conducted during the first to third week of December 2025, covering more than 175 firms of varying sizes. Moreover, investment and hiring intentions remain robust. Notably, 69 per cent of respondents expect the RBI to cut the repo rate by the end of Q4 FY26 (January-March end). CII expressed confidence that the reform momentum will continue in the Budget to sustain India’s growth. The survey also revealed a boost to sales from GST cuts effective from September 22, as 56.3 per cent of respondents expect their sales to increase between 5 and 20 per cent in the coming quarters. “The steady rise in business confidence shows industry’s ability to navigate external headwinds, anchored by resilient domestic demand and a robust reform agenda,” CII Director General Chandrajit Banerjee said.