New Delhi, May 27 (IANS): Cheered by the success of their subsidiaries in India, German businesses are looking to hire more and invest in expanding capacities inspite of the slow pace of reforms and recent scandals, according to a report released by the Indo-German Chamber of Commerce (IGCC).

In a survey of German companies operating in India, 55 percent of the respondents reported a 20 percent increase in revenues in the last financial year, while 16 percent reported a 10-20 percent rise in revenues, and 12 percent saw revenues rise by up to 10 percent.

More than a third of the companies surveyed said profits had grown by more than 20 percent, while about 20 percent reported a 10-20- percent increase in bottom lines.

Bernhard Steinruecke, director general of IGCC, said the recent rise in inflation, interest rates and scandals concerning the 2G spectrum had not affected German companies' plans of investments in India.

"Majority of the companies said that they want to increase their labour force by 10-20 percent. Most of the companies said that, yes, the recent scandals have harmed the image of India. On the other hand, when we asked whether that would curtail the investments, the vast majority said no," Steinruecke told IANS.

"So apparently these companies inspite of these challenges see the opportunities to expand and invest," he added.

Steinruecke also said that companies expect the growth in revenues and profits to continue this year as well.

More than half of the companies expect sales to surge by over 20 percent in 2011-12, while about 30 percent anticipate an increase between 10-20 percent.

German investor optimism about India is also on the rise, said the IGCC and about 57 percent of the respondents from the survey expected India's gross domestic product to rise by 8-9 percent and 70 percent pegging it above 8 percent for the next three years.

Talking about Indo-German trade, Steinruecke said India's share in bilateral trade had been increasing since the past few years and the balance which is still in favour of Germany was tilting.

"In the first three months of this year, the trade has gone up by 30 percent. So the target of reaching euro 20 billion in trade volume by 2012, will be reached. That is for sure," said Steinruecke.

He added that the proposed free trade agreement with Europe would give an impetus to Indo-German trade.

"In the next five years, trade volumes will certainly go up. Whether it is 20 or 30 percent annually we will have to see."