Doing business is easier says India Inc
Top CEOs have cheered India´s improved position in the World Bank´s ranking of countries on ease of doing business, and said the situation on the ground has improved considerably in the past few years andasuccessful rollout of the goods and services tax (GST) will help the country further improve its rankings in the coming years.
In a survey of 20 CEOs from across the nation on Wednesday, 80 per cent of them were of the view that due to a series of reforms undertaken by the Narendra Modi government, it had become easier to do business.According to the World Bank report, India improved its rankings in six of the 10 subcategories used by the institution to judge the business climate.
In some categories such as paying taxes, resolving insolvency, getting credit, and protecting minority shareholders, the ranking jumped significantly.India´s overall rank in ease of doing business jumped from 130 last year to 100 this year.Seventy five percent of the CEOs surveyed said though the GST rollout was facing teething problems, it had helped remove the trade barriers across the states.
Businesses don´t have to deal with multiple tax structures and octroi toll booths in Mumbai, which were known for corruption and obstructing supply chains.“Earlier, trucks in India were moving 40 per cent of the time and standing 60 per cent of the time.After the GST, goods are moving 60 per cent of the time and standing 40 per cent of the time,” saidaCEO.
Nirmal Jain, chairman, IIFL, said, “Indians are skeptical about India, but the world is taking note of India´s strides.As the GST settles, we will see further up move.” The CEOs were, however, unanimous that some parameters such as construction permits, enforcing contracts and registering properties needed improvement.
For this, they suggested that the entire process be automated so that the regulatory delays by officials did not hold up multibillion dollar projects.“Despite the lack of demand, real estate prices in big cities like Mumbai are not falling as builders have to payalot of cash in getting construction permits.The entire process should be made online so that permits are granted easily and off the shelf,” said the CEO of a real estate financing firm.
The World Bank report also highlighted that India´s rank in areas such as startingabusiness, enforcing contracts, and dealing with construction permits was below 150.“Dematerialisation of land records, automatic approval of construction permit and government backed title insurance scheme will goalong way in curbing corruption in the real estate sector,” said JC Sharma, vicechairman &MD, Sobha Developers.
Sixty per cent of the CEOs also said corruption was not coming in the way of doing business, while 40 per cent said it was. CEOs said that in the coming years, transaction enforcement needed to be strengthened and corruption needed to be addressed urgently.“Today, corruption at municipal corporations, electricity boards, pollution control board, and environment clearances at local levels are major challenges for companies,” said a Chennaibased CEO
The Business Standard, New Delhi, 2nd November 2017