India’s improvement in the ease of doing business ranking is a reflection of the series of small steps announced by the government but there is still a long way to go, says a Nomura report.
According to the Japanese brokerage firm, India is on the right track, but has a long road ahead.
Out of 189 countries ranked by the World Bank in its ease of doing business report, India’s rank has improved to 130 this year. In 2015, India was originally placed at 142nd position and later the same was revised to 134th place.
“The improvement reflects the series of small steps announced by the government to foster an investment-friendly environment,” Nomura said in a research note.
The report further noted that “with reform efforts ongoing, including the likely introduction of a bankruptcy law in winter session of the parliament, this trend of improving the ease of doing business in India should continue.”
India’s ranking on ‘getting electricity’ and ‘starting a business’ parameter has improved.
Businesses can now get electricity sooner due to fast internal processing and the removal of redundant inspections. In addition, starting a business has been made easier by eliminating minimum capital requirements through amendments to the Companies Act, Nomura said.
“Compared to other emerging markets, India’s ranking lags behind peers the most in dealing with construction permits, enforcing contracts and resolving insolvency,” it said.
As part of making the process easier for starting a business, the government has eliminated the requirements for a paid-in minimum capital and a certificate to commence business operations, significantly streamlining the process of starting a business.
The government targets breaking into the top-50 ranking within three years (by 2017).