Mumbai, March 11, 2025: ASSOCHAM along with Dun & Bradstreet, a leading global provider of business decisioning data and analytics, has released its Small Business Confidence Index for Q1 2025 which tracks the optimism of small and medium enterprises in India. The first quarter of calendar year 2025 has begun on a note of optimism for India's small businesses, pointing to early signs of recovery in most of the key metrics like sales and investment, as gauged by an ASSOCHAM-Dun & Bradstreet survey.
The Small Business Confidence Index (SBCI) for Q1 2025 stands at 107.3, marking an 18.4% q-o-q rise, signalling a cautious rebound in business sentiments. The report highlights improvements in sales, selling prices, and investment, alongside enhanced credit availability, pointing to early signs of recovery for small businesses. However, the gauge marginally dropped by 1% on y-o-y basis.
The report highlights improvements in sales, selling prices, and investment, alongside enhanced credit availability, pointing to early signs of recovery for small businesses.
“Early signs of recovery even in the midst of global trade uncertainties reflects inherent strength and resilience of Indian entrepreneurs. It is more heartening to see an uptick in confidence amongst small businesses, the backbone of the Indian economy,” said ASSOCHAM President Mr. Sanjay Nayar.
“With the RBI beginning the cycle of cut in the policy interest rates and visible signs of improvement in rural demand, we expect definite signs of growth momentum in 2025,'' said Mr Nayar.
According to the latest findings, sales volumes have increased by 1% y-o-y, pointing to some growth within the sector. However, sentiment around new domestic orders is weaker, with a 7-percentage point decline y-o-y. In contrast, export optimism has significantly improved, with a 60-percentage point increase in new export orders on a q-o-q basis and a 12-percentage point rise y-o-y, indicating stronger confidence in international markets. Profitability expectations have remained stable at levels seen in Q1 2024, underpinned by an anticipated 8% rise in selling prices, which is expected to help offset rising cost pressures. Meanwhile, moderating inflation has eased expectations for raw material costs, contributing to a more stable cost environment for small businesses.
“The ASSOCHAM D&B Small Business Confidence Index for Q1 2025 reflects a cautious yet improving outlook among small businesses. The uptick in sales, export orders and selling price expectations reflects early signs of recovery. However, subdued capacity utilization and hiring outlooks suggest that businesses are prioritizing operational resilience rather than rapid scale-up. Inventory management remains conservative, with firms maintaining lean stock levels to mitigate demand volatility. Looking ahead, the Union Budget 2025-26’s focus on supporting MSMEs through enhanced credit guarantees, tax rationalization, and improved trade facilitation is expected to reinforce business optimism and drive sustainable growth in both domestic and international markets.” said Mr Avinash Gupta, Managing Director, Dun & Bradstreet India.
"In 2025, India's economy faces slower growth, influenced by monetary easing and shifting fiscal policies. While small businesses show signs of recovery, the ASSOCHAM D&B Small Business Confidence Index for Q1 2025 reflects mixed results. Improvements in sales, prices, exports, and investments suggest gradual recovery, but capacity constraints and cautious hiring show businesses are prioritizing stability. Economic uncertainties and fluctuating demand remain concerns. The RBI rate cut, and expanded MSME credit guarantees aim to support liquidity and investment, while tax changes could boost consumption. Initiatives like ‘BharatTradeNet’ may enhance export competitiveness, supporting recovery, “said Dr Arun Singh, Global Chief Economist, Dun & Bradstreet.
Contact us