Corporate India bets on demand recovery in '25

Plans bigger capex, more hirings; expects govt to offer tax incentives

Corporate India is expecting a rebound in consumer spending and demand in the new year, with top executives gearing up for increased investments and hiring as company earnings climb.

A survey conducted by Business Standard in December, involving 50 chief executive officers, found that 80 per cent believe the government should offer greater tax incentives to the common person to boost consumption.

In 2024, high interest rates, soaring prices, and elevated food inflation significantly impacted consumption, especially in urban areas. Rural demand, however, showed signs of recovery in the latter part of the year, and 68 per cent of CEOs expect it to strengthen further in 2025.

Geopolitical tensions affecting global trade also emerged as a key concern for business leaders. CEOs remain apprehensive about potential extreme trade measures the United States might adopt as Donald Trump assumes the presidency in January 2025. However, optimism prevails regarding the domestic stock market and broader economy.

Many CEOs also foresee improved India-US relations under the Trump administration. Meanwhile, rising imports from China and the volatility stemming from the wars in Israel and Ukraine remain pressing challenges.