Editorial: Easing doing of business

By: | Published: September 16, 2015 12:20 AM

Govt does a good job in getting states on board

The government has stoked the competitive spirit among states by getting them ranked—by the World Bank—across eight broad parameters over the first six months of 2015 in implementing a 98-point plan on the Ease of Doing Business. This is a big first step for a country that, while being ranked a lowly 142 among 189 nations, is planning to make it to the top 50. Five of the top six states identified by the World Bank in terms of improved performance—Gujarat, Jharkhand, Chhattisgarh, Madhya Pradesh and Rajasthan—are all ruled by the BJP; Andhra Pradesh, ranked second, is ruled by the TDP, a BJP ally. While Gujarat leads with an implementation status of 71.14%, it cannot yet be classified as a Leader (implementation level of 75% or more) state. That none of the 28 states (Manipur’s not been included) and 4 Union territories (UTs) examined has been identified as a Leader is a sad commentary on India as such. While 7 states have been ranked as Aspiring Leaders (50%-75%) and another 9 as Acceleration Required (25%-50%), the irony is that the remaining 16 states are classified in the lowest category—Jump Start Needed. Of these 8 have scores below 10%, and that’s reason for worry.

What the study discovered is that today, of the states and UTs that allow e-filing of VAT, 28 have defined clear timelines for granting construction permits and 19 issue a single completion-cum-occupancy certificate. Andhra Pradesh is among the top-5 states for seven of the eight parameters, followed by Gujarat (6), Rajasthan and Madhya Pradesh (5 each) and Chahttisgarh (4). Gujarat also scored 100% in complying with environment procedures, while Jharkhand had the same score in complying with labour relations—what that essentially means is that these states have put the entire process online. That’s half the job done. The key to ensuring that the state retains its position in the future is implementation. The DIPP is expected to give states an action plan for the next set of reforms. While progress has definitely been achieved, there is no doubt that India is still a difficult place to do business. Hopefuly, the state ranking could result in changes that are replicated at the national level.

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