India demonstrated remarkable resilience in the face of global economic headwinds, recording the highest year-on-year growth in business investment confidence among 32 surveyed economies for Q3 2025. According to the Dun & Bradstreet (D&B) Global Business Investment Confidence Index, India's investment confidence surged by 12.6% year-on-year, even as it endured a minor quarter-on-quarter dip of 1.4%., reported DDNews web portal.

This achievement stands in stark contrast to the global trend, as the overall Global Business Investment Confidence Index fell significantly—down 13.1% quarter-on-quarter, marking the third consecutive quarter of contraction. The decline was broad-based, with all five of the index’s sub-indices showing sizable drops from the previous quarter. This is a reversal from Q2 2025, when only two sub-indices—capital expenditure and workforce size—saw reductions.

A critical factor shaping investment decisions for businesses remains supply chain stability. Nearly half of all firms (46.8%) considered it a pivotal determinant of their investment plans for Q3 2025. In contrast, factors such as tariff uncertainty and domestic interest rates were seen as less influential, a trend echoed by the low standing of the Global Supply Chain Continuity Index, which registered at 99.9 for the quarter—the lowest across all measured indices.

In the broader global context, investment confidence deteriorated more sharply in advanced economies than in emerging markets. Even when the U.S.—which fell 16.7% quarter-on-quarter and holds significant global weight—is excluded, advanced economies like France, Japan, Germany, and Spain led the declines, erasing gains from the previous quarter.

Among emerging economies, the steepest quarter-on-quarter drops occurred in the Russian Federation (-26.1%), Brazil (-23.9%), and South Africa (-20.7%). Notably, Brazil’s aggressive monetary policy tightening and South Africa’s exposure to U.S. tariffs on automotive exports contributed significantly to their declines.

A closer industry breakdown reveals the manufacturing sector as the hardest hit, with investment confidence sliding by 17.2% in Q3 2025, compared to a less severe 10.8% drop in the services sector. The largest falls were among manufacturers of capital goods (-33.1%), food (-26.9%), and automotives (-26.4%). The chemical manufacturing sub-sector experienced a comparatively smaller, though still substantial, drop of 14.8%, possibly cushioned by exemptions to new U.S. tariffs on pharmaceutical products.

Despite these challenges, there are positive signals: companies reported an expected capacity utilisation of 68.9% in services and 69.3% in manufacturing for Q3 2025—the first uptick in capacity use since Q1 2024. While these figures remain below the 2024 averages, they point to potential for future expansion and improved sentiment in capital expenditure planning.

India’s robust performance in this challenging environment underscores its sustained economic momentum and resilience, setting it apart as a global leader in investment confidence for the period surveyed.

Based On DDNews Report