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Modi Govt’s pro-biz policies lift Asian biz index: Thomson Reuters survey

Business sentiment across Asian countries improved during the October-December quarter, helped by robust performance by Indian companies on hopes of speedy recovery of the economy, says a recent survey.

The Asian business sentiment in Q4 increased to 72 from 66 in the previous three months, the survey said. The result was only slightly below the 74 reading of the second quarter which was the highest since early 2012. "Indian businesses provided the biggest boost to the index, with companies reporting a maximum score of 100 for the third consecutive quarter as they look to Modi to speed up economic recovery," it said.

Corporations in China, where worries about a slowdown in economic growth persist, were among the least positive with a reading of 50, coming in below Japan, which is stuck in recession, at 56. The US unemployment fell to a six-year low in November, a signal that the world's biggest economy and a key export destination for Asian companies is healthier and its consumers are growing in confidence, said the survey by Thomson Reuters/INSEAD Asian Business Sentiment.

"The US' economic leadership is influencing expectations across the world, and it is really becoming stronger," Singapore-based economics professor at INSEAD Antonio Fatas said.

He said Asia is a region where there is not massive uncertainty related to political risk and that it grows with the world. "The rosier picture in the US coincided with oil prices falling to five-year lows, boosting Asian economies dependent on imports of crude. However, uncertainty remained, not least in China where investors and companies are sitting and waiting for data to indicate how dramatically growth in Asia's largest economy is slowing," Fatas said.

Confidence among companies in Australia was second only to India in Q4 with an outlook index of 85, up from 75 in the third quarter, the report said.

Optimism in Japan hovered at 56, almost unchanged from 59, with more respondents worrying about a domestic economy that has fallen into recession and thrown up fresh challenges for Prime Minister Shinzo Abe's reflationary policies.
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