Even as Covid and the ensuing lockdown disputed business activity in the country, the registration of companies with the ministry of corporate affairs (MCA) increased 27% y-o-y in the just concluded FY21.
During the last fiscal, the MCA registered more than 1.55 lakh company incorporations compared to 1.22 lakh in FY20, an increase of 27%. Similarly, 42,186 limited liability partnerships also got incorporated against 36,176 last year, an annual growth of 17%.
The ministry attributed the growth in registrations to the various policy measures taken by the government to enhance the ease of doing business as well as to bring down the cost of starting a business in India, especially for entrepreneurs, start ups and individuals.
“The increase is significant considering the unprecedented situation faced by the country due to Covid-19 pandemic. As part of government’s drive for ease of doing business, the MCA has taken many initiatives thereby saving as many procedures, time and cost for starting a business in India,” the ministry noted. The Central Registration Centre continued to function even during the lockdown to enable stakeholders to incorporate Companies and LLPs.
A senior MCA official said the Centre has been continuously revising the regulatory environment and has taken several steps recently towards the ease of doing business, which played a crucial role in the number of company incorporations rising even in a year that has seen unprecedented disruptions.
The revision of definition of small companies, which has reduced compliance burden on about 2 lakh companies and the the zero MCA fee for company incorporation up to Rs 15 lakh authorised capital are some of the policies that has helped enhance ease of doing business.
Besides, incentivising the incorporation of one-person-companies (OPCs), de-criminalisation of technical and procedural violations under Companies Act have also helped in improving corporate sentiment.
Another such step was was MCA introducing the advanced integrated form SPICe+ (eForm-32), which facilitates the user’s ease in company incorporation.
SPICe+ is an integrated web form that offers 10 services by 3 central government ministries & departments. These are the ministries of corporate affairs, labour and revenue, which helps in saving time and cost for starting a business in India.