Prime Minister Narendra Modi’s Gujarat and Arvind Kejriwal’s Delhi have slipped in this year’s World Bank and DIPP’s ‘Ease of Doing Business’ Rankings! Andhra Pradesh and Telangana have topped the chart with a score of 98.78% each. While Gujarat has come in at number 3 with a score of 98.21%, Delhi has also dipped to rank 19th with a score of 47.62%. Notably, out of the top 10 states, 7 are BJP-ruled states. These are; Gujarat, Chhattisgarh, Madhya Pradesh, Haryana, Jharkhand, Rajasthan, Maharashtra. The rankings are an indication not only of the efforts made, but also how those efforts compare with other states.
While last year’s rankings were based on a 98-point action plan, this year DIPP had listed out a 340-point Business Reform Action Plan, on the basis of which states have been ranked. From labour regulation enablers and online tax return filing to single-window clearances and availability of land, 36 states and Union Territories have been ranked on a host of parameters that help decide how easy it is to do business in a particular area. We take a look at 5 big takeaways (some surprises, and some not!) from this year’s state-wise ‘Ease of Doing Business’ rankings.
1) Gujarat slips from the pedestal: Prime Minister Narendra Modi may no longer head Gujarat, but most expect his home state to top the charts each time. To be fair, it is easy to assume that the state is no longer as ‘easy to do business’ in, but at 98.21%, it is a close third. Last year, Gujarat had topped the state-wise rankings, with a score of 71.14%. This year, it has scored 98.21%. Out of the 340 points that form a part of the reforms agenda, Gujarat has implemented 330. As PM Modi said, the whole idea of rankings is in line with competitive federalism. However, if Gujarat wants to maintain its edge as an investment destination, it will need to do more to trounce others.
2) Telangana’s phenomenal rise: What stands out the most, apart from Gujarat’s loss, is Telangana’s rise. Founded in 2014, the state has risen phenomenally in the ease of doing business rankings. Last year, the state stood at 13, with a low score of 42.45%, and this year, it has topped the chart with Andhra Pradesh at 98.78%. One of the ‘good practices’ of Telangana that the report highlights is its move to introduce “self-certification to replace Tree NOC as long as required replanting activities are complied with”. This practice falls under the ‘Construction Permit Enablers’ category. Out of the 340-points put out by DIPP, Telangana has implemented 324 of them. It is yet to introduce 4 reforms, while 12 are not applicable for the state.
3) Haryana catches up: Haryana has been an industrial hub, especially for automobile manufacturers. And the state has edged up in rankings this time, entering the top 10 list at number 6. Haryana has a score of 96.95% and has implemented 318 points out of the 340 reforms agenda.
4) Karnataka, home to India’s IT capital, goes down: Karnataka is home to Bengaluru, India’s IT capital. India’s IT sector is one of the big growth drivers. One would then take it for granted that doing business in Karnataka would be a cake walk. Alas! The state has actually slipped from last year’s 9th rank (score: 48.50%) to 13th at 88.39%. Karnataka has implemented only 297 of the 340 reforms that are recommended by DIPP and lacks in 39 areas.
5) Arvind Kejriwal’s Delhi dips: Delhi, the country’s national capital, is bound to be in focus when it comes to business rankings. While Delhi did not particularly rank high last year either (15th rank), it has dipped even further to the 19th slot this year. It has a low score of 47.62%, significantly lower than the 18th state (62.80%), Tamil Nadu. Incidentally, its list of yet-to-be implemented reforms exceeds what has already been done! According to the report, Delhi has implemented only 160 out of the 340 reforms, with 176 pending and 4 not being applicable.