PNB SCAM SHOULDN’T LEAD TO ‘FEAR PSYCHOSIS’, SAYS FICCI

51% of respondents expect higher number of orders

Mumbai, March 11: The government and the Reserve Bank of India should make sure that the `13,000-crore Punjab National Bank scam does not lead to a “fear psychosis” in the financial system which chills economic activity in the country, a prominent industry lobby has said.

Emergence of the scam should not lead to a “paralysis” and “fear psychosis”, Rashesh Shah, the president of Ficci, said here.

Mr Shah, who also chairs the diversified financial services company Edelweiss, said he has written to both the RBI and the government with a request to ensure that the country does not slip into that zone.

The outlook for manufacturing sector in the country has improved in January-March quarter (Q4) as firms expect higher production, a Ficci report said on Sunday.

“Ficci’s latest quarterly survey on manufacturing expect positive outlook for the manufacturing sector in Q4 as the percentage of respondents reporting higher production in fourth quarter has increased significantly vis-a-vis previous quarter of 201718,” said the body.

It said that the proportion of respondents reporting higher output growth during Q4FY18 has increased significantly to 55 per cent from 47 per cent in the Q3 (October-December).

Ficci said that this positive outlook is notable as Q4FY18 witnessed the highest percentage of respondents expecting higher production since Q2 of FY17.

The percentage of respondents reporting low production has also come down to 11 per cent in Q4 from 15 per cent in Q3 of FY18, said Ficci.

In terms of order books, 51 per cent of the respondents in Q4 are expecting higher number of orders as against 42 per cent of Q3FY18 which again is a sign of revival, it said.

Ficci said its latest quarterly survey assessed the expectations of manufacturers for Q4 for twelve major sectors including automotive, capital goods, cement and ceramics.

Responses were drawn from over 300 manufacturing units from both large and SME segments with a combined yearly turnover of over `3 lakh crore.

Ficci said that the outlook for exports seems marginally positive as 47 per cent of the participants are expecting a rise in the exports for Q4 and 34 per cent are expecting the exports to continue on same path as that of same quarter last year.

“Hiring outlook for the sector remains subdued though better than last quarters, in near future as 70 per cent of the respondents mentioned that they are not likely to hire additional workforce in next three months. This proportion has declined as compared to the previous quarter where 85 per cent of the respondents were not in favour of hiring additional workforce,” it said.