New Delhi / Mumbai: According to a survey by MasterCard International, Indian consumers are more optimistic about the next six months now than they were in August last year.

In India consumer sentiment scored 72 points in February this year against a score of 58 points six months ago, and up from even 63.5 in the first half of 2004 according to the survey.

The survey covered the markets of Egypt, Kuwait, Lebanon, Saudi Arabia, the United Arab Emirates, South Africa and India. Called the MasterIndex of Consumer Confidence, the survey awarded points on a scale of 1-100 across five parameters. Consumer confidence in India was seen to be better than in Lebanon and Egypt. In Kuwait, Saudi Arabia, South Africa and the UAE, the index was at 94.6, 93.2, 83.5 and 92.9 respectively.

The statement went on to say that, "The consumers in India are slightly optimistic about employment (54.6), fairly optimistic about the economy (69.7) and quality of life (74.7), and have fairly high expectations of regular income (80.5) as well as of the stock market (80.1)."

The survey covered 400 individuals in the 18-64 age group in Mumbai and Delhi, and asked for their outlook on the parameters of: regular income, economy, quality of life, stock market and employment.

The MasterIndex has a range of 0 to 100, with 50 as the mid-point. A score of 50 denotes no change in consumer confidence. A score above 50 indicates optimism about the quality of life over the next six months while a score below 50 indicates pessimism.

Tom Joehnk, economist with the UK-based Economic Intelligence Unit, said that for the Indian consumer, low interest rates, well-anchored inflation expectations and a positive economic growth outlook, have been the main drivers of increasing this optimism.

Joehnk said that rapid economic growth and low and stable inflation were positives for the country. Record low interest rates, a strong external position including rising forex reserves, low levels of external debt and an appreciating currency, are important from the consumers'' point of view, he said. However, according to him the unsustainable fiscal deficit was a cause for concern.

Joehnk said the current level of investment, which is 26 per cent of GDP, is insufficient to sustain growth of 7-8 per cent. Apart from this the banking reforms were disappointing particularly with reference to the presence of foreign banks in India, because it keeps out competition. He said the conditions in India were not conducive to foreign banks but the impact would be felt only after 2009, when the second phase of reforms would begin.