From being cautious to being optimistic, India Inc's business sentiments are drawing closer to pre-pandemic levels, hinting on a more robust performance in the next quarter, a Grant Thornton Bharat Survey has revealed. Government's move to make taxation transparent (40%) has been considered as their most impactful initiative followed by the Production Linked Incentive (PLI) scheme, (30%) equalisation levy (20%) and new labour codes (10%), as per the survey findings.
The survey was carried with 3,700+ respondents across digital platforms, hinting on the rising global and domestic optimism related to revenues in 2021. Six out of ten respondents feel that reducing tax and compliance burden will help revive businesses, post the second wave. An uptick in direct spending, followed by additional liquidity infusion and increased FDI flows, respectively, are also some of the other relief packages that respondents feel can help boost cross-border and domestic trade.
“The reduction in the corporate tax rates, attempts to reduce litigation through dispute resolution schemes, bringing in more transparency through various tax administrative reforms, boost to the MSMEs through various policy initiatives, are all yielding results and adding to the positive business outlook in India,” says Vikas Vasal, National Managing Partner, Tax, Grant Thornton Bharat.
The survey also notes the impact of COVID-19 on businesses. Half the respondents (50%) feel the pandemic has had a devastating effect on businesses and economy, while the remaining feel the wave was either not as bad as the first one or there is hope for recovery in the next two quarters.
Effective change management in business strategies, not just re-structuring of businesses, has also put the focus on integrating sustainability and ESG into corporate business strategy as stakeholder activism and reputation management gain more ground.
The survey by Grant Thornton Bharat, reveals 61% of the respondents agree to assimilate ESG into core business agenda. The focus has shifted from profit accumulation to building sustainable and resilient business models, which will not only test the waters but also survive and continue to grow in the long run.
While 18% hint on reducing their focus on ESG and sustainability; 16% feel COVID-19 has not led to an increased focus on ESG. A small section, 5% of the respondents, have meanwhile already assimilated ESG and sustainability goals into their overall business approach.
“No future/forward thinking organisation can ignore the sustainability revolution and it is evident from the survey report. As sustainability and ESG grabs eyeballs, this needs to be understood for its long-term value creation. Addressing the risks, envisioning achievable targets and investing in the right strategy will be key in invoking a sense of shared ownership,” says Dinesh Anand, Partner, Risk and ESG Leader, Grant Thornton Bharat.