NEW DELHI: Small businesses in India have achieved their most robust growth since 2019, demonstrating significant resilience and confidence in future expansion, according to a recent report. Despite prevailing cost pressures, the sector’s performance indicates a strong recovery and optimistic outlook for the coming year.
Information was available with The Chenab Times indicating that the Asia-Pacific Small Business Survey 2025/26, conducted by CPA Australia, found that 80 percent of Indian small businesses experienced growth last year. This figure substantially surpasses the Asia-Pacific average of 63 percent, highlighting India’s strong performance within the region.
Looking ahead, the report projects continued optimism, with 87 percent of Indian small businesses anticipating growth in 2026. Furthermore, 84 percent expect positive developments in the local economy, reinforcing India’s standing as one of the most upbeat small business markets in the Asia-Pacific. Key factors contributing to this growth include improvements in customer experience and increased adoption of technology.
However, the survey identified rising costs as a primary challenge, potentially impacting future expansion efforts. A significant 42 percent of respondents cited increasing costs as their most substantial hurdle in 2025, with material costs consistently ranking as the most detrimental cost pressure for the third consecutive year.
Micro, Small, and Medium Enterprises (MSMEs) continue to play a crucial role in job creation, bolstered by a new cohort of younger business owners who are emerging as significant drivers of growth and transformation across the sector. The demand for external finance remained strong in 2025, with four out of every five Indian MSMEs requiring such funding, an increase from 72 percent in 2024. Encouragingly, 53 percent reported that accessing finance was easy or very easy, suggesting an improvement in financing conditions.
The survey, which gathered responses from 4,166 small businesses across 11 Asia-Pacific markets, including 513 from India, was conducted in November and December 2025. A spokesperson for CPA Australia in India, Aniket Talati, commented on the evolving business environment.
“Rising geopolitical uncertainty since March has added volatility to the business environment,” Talati stated. “While the service sector remains largely unimpacted, manufacturing and export-oriented MSMEs are facing multiple pressures, including higher energy and logistics costs, rising raw material prices, and uncertain order pipelines.”
He also noted that a weakening rupee could have potentially improved export margins and helped to mitigate some of the cost impacts. To sustain growth and profitability, Talati emphasized the critical importance of careful planning, proactive cost management, investments in renewable energy and alternative materials, robust cash-flow control, and effective risk management strategies for the period ahead.
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The Chenab Times News Desk