Bhumesh
Ease of Doing Business - India takes a giant leap
Bhumesh Verma 2 Nov 2018

Ease of Doing Business - India takes a giant leap

In this Diwali season, there’s something more to cheer about India and its economy.

The Ease of Doing Business Report 2019 (‘Report’) released by the World Bank manifests India’s massive jump in the rankings by securing 77th rank as against 100th rank in the last year’s report.  On the points indicator, India has improved the scoring to 67.23 from 60.76 last year.

The World Bank compiles this report based on the assessment of countries’ performance on ten parameters (Starting a business, Protection of minority investors, Trading across borders, Registering Property, Enforcing contracts, resolving insolvency, Tax payments, Dealing with construction permits, Getting electricity and Getting credit).

Apart from registering its best rank in the ‘Ease of Doing Business’ index so far - India has also become highest ranked nation in South Asian nations dethroning Bhutan. After India, even Afghanistan has made tremendous progression amid south Asian nations.  

For the second year running, India has also emerged as one of the top ten improvers in the world as a result of the constant improvement shown by India in six parameters out of ten. In relation to seven out of these parameters, India has moved close to international best practices.

During the period (2008-2017), India stood around the 130th rank. It was only last year that India breached the 100th barrier by reaching 100th rank in the Ease of Doing Business Index

India’s ranking progress during the last ten years period is as under:

2008 – 132

2009 – 133

2010 – 139

2011 – 132

2012 – 131

2013 – 134

2014 – 134

2015 – 131

2016 – 131

2017 – 130

2018 – 100

2019 – 77

This progress is the reflection of the constant efforts placed by the central government in developing the nation into a friendly hub for regional and international investors to make investments via certain outstanding reforms in business sector.

The following factors, inter alia, have immensely assisted India in improvising its rank in the Report:

·Enforcement of several economic reforms (Goods and Services Tax (GST), Insolvency and Bankruptcy Code (IBC), Labour law reforms, Electronic trade documentation etc.)

·Simplification of payment process of taxes by introducing a single indirect tax (GST) via replacing various indirect taxes.

·Reduction of corporate tax rate for small businesses constituting a major chunk of assessees.

·With the assistance of IBC law lenders will be able to recuperate bad loans worth more than 1 lakh crore.

·Containers electronic sealing, port infrastructure up-gradation and processing of electronic documents with digital signatories has resulted in time and cost reduction associated with trade.

·Organized process for procuring building permit – Accessibility and availability of the electricity on faster and cheaper basis.

·Certain reforms implemented in the Delhi and Mumbai metro cities.

The latest ranking of India in the Report will certainly facilitate the nation to attract more investments from foreign investors as well as regional investors.

So far, so good. However, the central government must focus on improving more areas along with sustaining the progress/momentum accomplished so far to go further in such rankings as well as the perception on the ground in coming years.

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