The Indian PR industry, like the larger economy, has been in a “growth recession”. While it grew at an estimated 30% per annum for the last five years, the growth this fiscal (ending March – 2009) might plunge to about 10%.

A fairly significant number of clients of PR services, particularly the small and mid-sized ones, signed off in the quarter ending December 2008, while hundreds more asked for fee reductions. In many cases it seemed like a knee-jerk reaction to cut costs, irrespective of the consequences. In some cases, corporates simply took advantage of the environment to reduce fees.
The current quarter seems more stable. My belief is that the industry will bounce back in the next three to six months. We should expect a healthy growth next year and focus right now on managing resources and capacity.

This is exactly what I had said on the India PR Blog and in a recent article in DNA Money.