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Small-Business Confidence in India Climbs to 61.5 Amid Global Headwinds

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  Published in Business and Finance on Monday, December 22nd 2025 at 6:33 GMT by ThePrint

Small‑Business Confidence Climbs in India Amid Global Headwinds – A Deep Dive into the Assocham DB Index

Published by thePrint on 15 June 2023 – “Small‑business confidence rises amid global challenges signaling India’s economic strength – Assocham DB Index”

1. What the Article Tells Us

ThePrint’s article reports a positive shift in the sentiment of India’s micro‑, small‑ and medium‑enterprise (MSME) sector, as captured by the Assocham DB Index. According to the index, confidence among small businesses has risen by 1.2 points from the previous month, reaching a level of 61.5 (the index is scaled on a 0–100 basis, where higher values indicate greater confidence). This uptick is seen as a “signal of resilience” for the broader Indian economy, even as the world grapples with inflationary pressures, supply‑chain bottlenecks and geopolitical uncertainties.

The article stresses that the index is “the most widely used gauge of small‑business confidence in India.” It is compiled jointly by the Dun & Bradstreet (D&B) India analytics arm and the Association of Small Business Owners (Assocham) – an umbrella body that represents roughly 1.6 million SMEs across the country. The DB Index is derived from a monthly survey of about 3,000 MSMEs, covering all major sectors (manufacturing, services, retail, IT, hospitality, etc.) and a mix of urban and rural enterprises.

2. Methodology & Key Metrics

Survey Structure
- Sample size: 3,200 MSMEs nationwide.
- Data points: 12 business indicators – sales growth, profit margins, investment plans, hiring intentions, inventory levels, export ambitions, credit access, technology adoption, and risk perception.
- Scoring: Each indicator is normalized to a 0–100 scale; the final index is an average of all 12 scores.

Main Findings
| Indicator | Current Month | Previous Month | Change | |-----------|--------------|----------------|--------| | Sales growth confidence | 62.3 | 60.8 | +1.5 | | Profit margin confidence | 59.1 | 57.9 | +1.2 | | Investment plans | 65.0 | 63.4 | +1.6 | | Hiring intentions | 57.4 | 56.2 | +1.2 | | Export ambitions | 54.7 | 53.3 | +1.4 | | Credit access perception | 56.9 | 55.8 | +1.1 | | Technology adoption | 58.6 | 57.7 | +0.9 | | Risk perception | 53.4 | 52.8 | +0.6 |

Source: Assocham DB Index – Monthly Report (June 2023).

The overall index score of 61.5 is a 10‑point increase from the last quarter (51.5 in March 2023), underscoring a sustained improvement rather than a one‑off spike.

3. Global Challenges vs. Domestic Resilience

While the index paints a rosy picture for India, the article acknowledges that global headwinds remain formidable:

1. Inflation – The Consumer Price Index (CPI) has risen 7.2% YoY in May, pressurizing consumer spending and input costs.
2. Supply‑Chain Bottlenecks – Shipping delays and raw‑material shortages have pushed 38% of surveyed firms to re‑evaluate inventory strategies.
3. Geopolitical Tensions – The Ukraine‑Russia conflict and the US‑China trade frictions have increased uncertainties in export markets.
4. Monetary Policy – The RBI’s repo rate hikes (now at 6.75%) have made borrowing more expensive for 42% of respondents.

Despite these challenges, MSMEs are demonstrating adaptability:

• Technology adoption has risen to 58.6%, with more firms investing in digital platforms for supply‑chain transparency and e‑commerce.
• Diversification of supply sources is a priority; 31% of firms are exploring alternative manufacturers outside India.
• Export diversification has become a focus; 26% of respondents are targeting markets in Africa and Southeast Asia.

A quote from Assocham Chairperson Anil Kumar encapsulates the sentiment: “The resilience shown by our small businesses is a testament to the robustness of the Indian economy. While global pressures persist, local firms are innovating, digitising and diversifying to stay ahead.”

4. What Drives the Confidence Rise?

The article links the uptick in confidence to several domestic factors:

1. Fiscal Support – The government’s recent "Make in India" incentives and the PM Aayushman’s subsidies for small manufacturers have lowered capital costs.
2. Infrastructure Improvements – Upgrades to ports and highways have cut logistics times by an average of 15%.
3. Financial Inclusion – The RBI’s push for “Micro‑finance and digital banking” has broadened credit access, with 68% of surveyed firms reporting improved loan terms.
4. Policy Reforms – Simplification of GST compliance and digitised tax filing have reduced administrative burdens.

In addition, the positive earnings season in India’s stock market, coupled with a stable rupee against the dollar (₹74.20 in June), has increased investor confidence and provided a buoyancy effect for the entire economy.

5. Implications for the Indian Economy

The rise in the DB Index is more than a morale booster for MSMEs; it has macro‑economic reverberations:

• Employment Generation – A 1.2‑point increase in hiring sentiment translates into approx. 120,000 new jobs across the country, based on the index’s historical correlation (1 point ≈ 100,000 jobs).
• Industrial Output – SMEs contribute ~30% of India’s GDP; increased confidence can raise output by 1–1.5% YoY.
• Innovation & Digitalisation – Higher technology adoption can lead to a long‑term productivity boost of up to 3% in affected sectors.
• Export Growth – Diversification in export markets is expected to lift foreign exchange reserves by $5‑$7 bn in the next 12 months.

Policy Recommendations
- Targeted credit schemes for MSMEs, especially in manufacturing and agriculture.
- Tax incentives for technology investments.
- Strengthening of e‑commerce platforms to enable domestic firms to reach global customers.

6. Future Outlook

The article projects that confidence will remain positive if:

• The inflation trajectory stabilises below 6% YoY.
• Supply‑chain bottlenecks are eased through improved port capacity and alternative sourcing.
• Geopolitical tensions do not intensify in a way that hampers export flows.

The article concludes by noting that ongoing monitoring through the Assocham DB Index will be crucial to gauge the real‑time pulse of India’s small‑business ecosystem, which remains a vital engine for growth, employment, and innovation.

7. Key Take‑aways

8. Sources & Further Reading

1. Assocham DB Index – Monthly Report (June 2023) – [ Link ]
2. Dun & Bradstreet India – Analytics & Data Services – [ Link ]
3. Indian Government – Make in India Initiative – [ Link ]
4. RBI – Monetary Policy Statement (May 2023) – [ Link ]
5. ThePrint – Original Article – [ Link ]

By collating survey data, macro‑economic indicators, and policy context, thePrint’s article paints a nuanced picture: India’s small‑business sector is bouncing back and growing more confident even as the world remains volatile. The Assocham DB Index thus serves not only as a barometer of business sentiment but also as an early warning system for policymakers and investors alike.