With the Narendra Modi government about to complete two years in office, a majority of corporate houses in the country are of the view that a lot more needs to be done to improve ease of doing business, says a survey.
A majority of respondents in a poll by PHD Chamber have rated the improvement in ease of doing business at 4.6 out of 10, indicating there is a long way to go for visible change to be felt at the ground level.
The survey on the completion of two years of the NDA government at the Centre is based on over 2,000 responses received from various businesses including micro, small, medium and large enterprises.
“Though the respondents unanimously felt that there has been some improvement in the sentiments for doing business, still there is a long way to go for a visible change to be seen and felt at the ground level,” PHD Chamber said.
While some parameters have been observed to have attained a good score from the respondents, including an improvement in the availability of adequate infrastructure (5.6/10) and improvement in investor friendly environment (5.4/10), yet survey points towards the urgent need for speedy reforms.
“There is a significant improvement in the bureaucracy and a score of 5.2/10 has been obtained in this parameter. They are aware of changes in the policy environment and are serious to implement the policies,” PHD Chamber said.
However, improvement in interface with the bureaucracy (with a score of 4.2/10) is still not according to the expectations of the respondents.
However, respondents unanimously felt that the government has to go a long way to improve the distribution of utilities and a score of 5.2/10 has been assigned to this indicator.
The availability of credit, once considered a major hurdle in the ease of doing business has seen some improvement and has been given a score of 5.2. However, the businesses, especially MSMEs face problems in procuring credit from banks.
The survey found that companies still face issues while dealing with tax authorities and settling tax disputes. The implementation of GST is awaited with the utmost anticipation.
A majority of respondents have expressed their annoyance at the lack of timely implementation of the GST and have desired its operation with immediate effect, said PHD Chamber.
Besides, the regulatory and procedural bottlenecks still remain a major concern and have not been able to reduce the time taken in the entire lifecycle of the business.
It has been suggested that regulatory set-up should facilitates smooth and efficient functioning of businesses.
The survey points out that there has been no significant improvement in 4 factors of production such as availability of land and the labour laws have not yet been simplified.
“There is still no clarity on the Land Acquisition Policy. Transaction costs still remains a major challenge for most businesses,” PHD Chamber said.
Rationalising the interest rate scenario is the need of the hour as our costs of borrowings are still significantly higher as compared with advanced, emerging and developing economies, said the industry body.