Using feedback from 25,000 internet users across 50 countries, Nielsen, in their six-monthly Global Consumer Confidence Survey show extent of decline in global consumer confidence. Having previously tracked increased India confidence, survey now reflects current caution.

Cautious India still performs well

Having scored record high index score of 137 in 2006 survey - 100 being considered "upbeat" - India now scores 99. Whilst the drop is considerable, global average is just 77, down on 84, six-months previous and 99 in second half of 2006. For comparison against other emerging markets, UAE currently score 89 (down 21), Brazil score 82 (down 15) and Russia score 74 (down 29).

Positioned third overall, behind Indonesia (104) and Denmark (102), Indian consumer feels insulated from global pressures. Expectations for recovery show confidence, 56% of Indian respondents - second highest after Vietnam - expect their economy to recover within a year, compared to global average of just 23%.

Global fragility

Crisis of confidence is not confined to India, 48 of 50 markets have seen their index score drop. Nielsen make the point that dramatic deterioration over six months raises questions about effectiveness of Government stimulus packages.

It also appears that global financial shock will have long term implications on global consumer spend, 40% will continue to try to save on gas and electricity even after recovery, 20% expect to continue to look for less expensive groceries.

Optimistic India

While the "decoupling" theory - built on a belief that India's domestic market was big enough to avoid exposure to US slow down - has been exposed as myth, it appears to have softened the blow. The outlook appears good.

While current caution is understandable, signs suggest that consumers are expecting recovery soon. If any sign of recovery is supported by increased consumer spend, India stands a good chance of bouncing back quicker than many other international markets.