In a first, India has risen 30 positions to rank 100th amongst 190 countries in the World Bank’s ‘Ease of Doing Business index’ for 2018 as a host of regulatory and policy reforms introduced by the government in the last four years started delivering results.
As per the 2018 version of the Ease of Doing Business index issued by the World Bank, India has been amongst the world’s top ten improvers worldwide and a leading regional reformer.
“India is the only large country this year to have achieved such a significant shift,” World Bank said.
The significant change also gives credence to the business and economic reforms undertaken by Prime Minister Narendra Modi-led National Democratic Alliance (NDA) government since it came into power in 2014.
Of the 37 reforms implemented by India since 2003, nearly half were undertaken in the last four years.
“With the eight reforms enforced in the system, India made paying taxes easier by requiring that payments be made electronically to the Employees Provident Fund and introducing a set of administrative measures easing compliance with corporate income tax,” said a World Bank statement.
The 8 areas, out of 10, where India implemented reforms were starting a business, dealing with construction permits, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency.
While India made substantial progress overall, it still lags in areas like starting a business, enforcing contracts and dealing with construction permits.
The report also mentioned the substantive changes implemented by the Indian Government in 2016-17 that included merging of applications for the Permanent Account Number (PAN) and Tax Account Number (TAN) for starting a new business.
“India reduced the number procedures and time required to obtain a building permit by implementing an online system that has streamlined the process at the Municipality of New Delhi and Greater Mumbai,” the statement added.
“Tackling these challenging reforms will be the key to India sustaining the momentum towards a higher ranking,” said country director India, Junaid Ahmad.
He added that to secure changes in the remaining areas will require not just new laws and online systems the ongoing investments in the capacity of states and their intuitions to implement change and transform the framework of incentives and regulation facing the private sector.
Meanwhile, Finance Minister Arun Jaitley has stated that the implementation of the Indirect tax reform (Goods & Services Tax) in July will start paying dividends in future rankings.
The Ease of Doing Business report is based on how easy it is for companies to do business as well takes in account certain regulations based on ten parameters including starting a business, getting electricity, dealing with construction permits and paying taxes among others.
Earlier in 2016, India was ranked among top 50 in three categories including minority investment, getting electricity and getting credit, but it ranked among the worst in the world in dealing with construction permits, resolving insolvency, registering property, trading across borders, paying taxes and enforcing contracts.
India is seeking to reach the 30th rank by 2020 in a bid to attract greater foreign investment.
Historic jump in ‘Ease of Doing Business’ rankings is the outcome of the all-round & multi-sectoral reform push of Team India. pic.twitter.com/DhrEcuurgi
— Narendra Modi (@narendramodi) October 31, 2017
With agency inputs