A majority of CEOs in India, accounting for 62%, express confidence in their company's anticipated growth in the coming year. Moreover, Indian leaders are firmly convinced that their organisations are heading in the right direction. Furthermore, 86% of Indian CEOs are optimistic about the improvement of the Indian economy in the next 12 months.
PwC's 27th Annual Global CEO Survey, which surveyed 4,702 CEOs across 105 countries and territories, including 79 from India, uncovered these insights. The survey underscored surge in confidence, revealing that the optimism among Indian leaders regarding their country's economic growth has risen by almost 30% in the past year.
Despite a sense of optimism among global leaders for the future, there remains a degree of caution in their predictions for the coming year. 44% CEOs worldwide express the belief that the economy in their respective territories will improve.
The positive outlook in India is resonating on a global scale. According to the CEO Survey, India has regained its standing as the fifth most favoured investment destination for global CEOs, a significant jump from its ninth position in 2023.
A substantial 62% of CEOs in India express confidence in their company's growth over the upcoming 12 months, while leaders in India exhibit a strong conviction that their companies are moving in the right direction.
When queried about their confidence levels regarding their company's growth in the next 12 months, 62% of India's CEOs responded with 'extremely or very confident,' a figure significantly higher than the 37% reported by global CEOs. Moreover, 70% of India's CEOs, in comparison to 49% of their global counterparts, affirm confidence in their company's prospects for revenue growth over the next three years.
Although a majority of Indian CEOs express confidence in the future, a substantial segment is apprehensive about the necessity of adapting to change to align with forthcoming trends. While 59% of CEOs in India, in contrast to 53% of their global counterparts, believe that their companies would maintain economic viability for over 10 years following their current trajectory, 38% express concern that their companies might sustain economic viability for less than 10 years under these circumstances.
Inflation, cyber risks and health concerns
India's CEOs identified inflation and cyber risks as the most significant threats to their businesses in the short term, spanning a 12-month period. Despite India's annual retail inflation reaching a 15-month high of 7.44% in July 2023, it had moderated to approximately 5.5% by November 2023.
The perceived risk from cyber threats has surged by 10% from the previous year, with 28% of India's CEOs—compared to 18% last year—anticipating extreme or high exposure to such risks. Health threats also rank prominently on the concerns of India's CEOs, with 27% expressing expectations of extreme or high exposure over the next 12 months.
This heightened concern for health is evident in employees actively seeking employers who provide comprehensive health insurance coverage for their families.
GenAI to deliver significant top- and bottom-line benefits
Approximately 71% of CEOs in India anticipate that the integration of Generative Artificial Intelligence (GenAI) will enhance employee efficiency over the next 12 months, while a slightly lower but substantial 70% believe it will improve their own performance.
Furthermore, there is a shared belief among these CEOs that GenAI is likely to contribute to increased revenue (48%) and improved profitability (46%). While acknowledging the potential impact of GenAI on employment, around 30% of India's CEOs perceive a possibility of job reduction.
However, there is a broader acknowledgment of the technology's potential to create new job opportunities, with 48% expressing that it would have little or no impact on headcount, and 13% foreseeing an increase.
It is evident that India's CEOs are mindful of the associated risks with GenAI and recognise the need for vigilant oversight. A significant 71% foresee an increase in cybersecurity risk, and 53% believe it will raise legal liabilities and reputational risks.
The reinvention of businesses among India's CEOs is increasingly driven by changing customer preferences, with 61% stating that customer choices have led to transformations in how their companies create, deliver, and capture value over the last five years.
Moreover, technological change (57%) and government regulations (47%) are identified as significant triggers for reinvention. The regulatory environment, along with a shortage of skills within the company, stands out as the primary barriers to reinvention for Indian CEOs.
“Despite continuing global headwinds, the Indian economy has remained resilient with expectations of a strong growth trajectory in the near future. While India CEOs will indeed play a big role in the country becoming a five-trillion-dollar economy, they will also need to reinvent their businesses and work culture to ensure long-term sustainable success,” said Sanjeev Krishan, Chairperson, PwC in India.
He added, “India’s business leaders will need to strategically tackle barriers such as regulatory constraints and lack of tech capabilities to turn them into growth opportunities which will create lasting value for businesses, society and the environment.”
Climate risk: A growing priority for businesses
In the 2024 survey, CEOs in India demonstrated a heightened awareness of the pressing need to accelerate efforts in addressing climate change. Despite recognising that there is still work to be done, only a small proportion (8%) reported having completed projects aimed at improving energy efficiency and reducing consumption.
However, a significant 82% indicated that such initiatives were currently in progress, with merely 4% stating that they had no plans in this regard. Progress was reported by India's CEOs in several key areas, including decarbonisation, climate adaptation, reskilling the workforce, and investments in nature-based climate solutions.
Nonetheless, they also highlighted various challenges hindering Indian companies' ability to decarbonize to a moderate or large/very large extent. These challenges include regulatory complexity (50%), a perceived lack of climate-friendly technologies (49%), insufficient demand from external stakeholders (44%), and lower returns on climate-friendly investments (48%). These obstacles underscore the complex landscape that businesses in India navigate as they strive to make meaningful contributions to climate action.
“In today’s complex business environment, there is a real need for business leaders to develop forward-thinking strategies on technology and climate to stay relevant. India CEOs must realign their businesses while keeping climate priorities in mind as well as make bold moves to adopt new technology to enhance their capabilities,” Sanjeev Krishan, Chairperson, PwC in India concluded.