Corporates slash Diwali gifting by 20 per cent

According to a study done by Assocham, it has not been very encouraging for India Inc. amid uncertain recovery in economic gro-wth and a deficient monsoon. Consumer spending may also be subdued as cost of living and prices of food items have grown faster than earnings which is compelling people to refrain from overspending during the festive season.

“Depreciating rupee, weak consumer demand showing up in sluggish sales, muted wage growth, impact of turbulence in global markets are certain key factors forcing corporates to slash their Diwali gift budgets significantly,” pointed the study.

The size of sweet boxes, which are generally gifted during Diwali, has also shrunk because of lower budgets. According to Assocham, last year a new government had been elected which boosted optimism and led to a rise in consumer confidence together with improved job security. This improved the business sentiment which encouraged companies to increase their festive budgets by 10-15 per cent.

“This time around there is a bleak business outlook for trade and industry as government struggles to rev up economic growth and labour market,” said D.S. Rawat, secretary general of Assocham. “Even consumers are likely to tighten their purse strings due to rise in prices of essential food items like pulses, edible oil due to poor monsoon rains,” he added.