PTI New Delhi

Business sentiments in India moderated in the second quarter of the current fiscal year, following three consecutive quarters of improvement, amid high global uncertainties, including additional US tariffs, according to the latest Business Expectations Survey of economic think tank NCAER.

The National Council of Applied Economic Research (NCAER), in a statement, said the quarter was also marked by GST reforms and a reduction in tax rates, whose effects are expected to be felt over the remaining two quarters.

"The Business Confidence Index (BCI) moderated to 142.6 in the second quarter of 2025-26 from 149.4 in the first, though it was higher than the corresponding Q2 of 2024-25 (134.3)," it added.

The BCI is based on four components: overall economic conditions to improve in the next six months, financial position of firms will improve in the next six months, present investment climate and whether present capacity utilisation was close to or above the optimal level.

According to the statement, the BCI was driven down by the moderation of sentiments in three of the four components, except present capacity utilisation, which saw an improvement. "Overall, the share of positive responses remained above 50 per cent in the second quarter for all four components, signalling a relatively slower growth momentum," the statement said.

The latest round (134th) of the quarterly Survey was carried out in September 2025, covering 484 respondents (companies) spread across six cities, days after the Trump Administration announced additional tariffs on Indian goods.