Indian small businesses recorded their strongest growth since 2019 in 2025, according to CPA Australia’s survey. The report highlighted rising optimism for 2026, strong digital adoption, increasing AI investments and continued employment growth despite mounting cost and cybersecurity challenges
Published Date – 28 May 2026, 08:39 PM
New Delhi: Indian small businesses recorded their strongest performance since 2019 in 2025 and remain highly optimistic about growth in 2026 despite rising cost pressures, according to CPA Australia’s Asia-Pacific Small Business Survey 2025/26.
The survey found that 80 per cent of Indian small businesses reported growth last year, significantly higher than the Asia-Pacific average of 63 per cent. Further, 87 per cent of businesses expect growth in 2026, while 84 per cent anticipate improvement in the local economy, making India one of the most optimistic small business markets in the region.
According to the survey, customer experience improvements and technology adoption were among the key growth drivers in 2025. However, rising costs remained the biggest challenge, with 42 per cent of respondents identifying increasing costs as their primary concern. Material costs continued to be the most damaging pressure for the third consecutive year.
CPA Australia spokesperson in India Aniket Talati said Indian MSMEs had shown strong ambition to expand due to strong domestic demand and government support measures.
The survey also highlighted strong employment growth, with 52 per cent of Indian MSMEs increasing staff numbers in 2025 and 69 per cent planning further hiring in 2026.
Digital adoption continued to accelerate across the sector. Around 89 per cent of Indian small businesses generated more than 10 per cent of their revenue through digital payments, the highest in the Asia-Pacific region. Additionally, 74 per cent earned over 10 per cent of revenue through e-commerce, while nearly 90 per cent used social media for business operations.
Investment in artificial intelligence also increased sharply, rising from 26 per cent in 2024 to 36 per cent in 2025. About 41 per cent of businesses said they sought business advice from AI tools.
The survey also flagged rising cybersecurity concerns, with 47 per cent of businesses reporting lost time due to cybersecurity incidents.
Demand for external funding remained strong in 2025, with four out of five Indian MSMEs seeking finance, mainly to support business expansion.
The survey was conducted in November and December 2025 across 11 Asia-Pacific markets, including 513 businesses from India.
