India Scores a century

India Scores a century

Jumps 30 spots to 100 in world  Bank's Ease of Doing Biz Rankings

India has for the first time broken into the club of the 100 nations easiest to conduct business in, driven by ease of paying taxes, resolving the insolvency problem, access to credit, and protection of minority investors.The World Bank´s ´Doing Business 2018: Reforming to Create Jobs´ report, released on Tuesday, showed India´s rank in ease of doing business jumped 30 places to 100 among 190 countries.

India´s rank was 130ayear ago. India has also been adjudged the fifth bestperforming nation globally in reforming the business environment.The country improved its rankings in six of the 10 subcategories used by the World Bank to judge the climate of business.The report, covering the period from June 2 last year to June 1 this year, ranked India top among the South Asian nations.

India´s distance to frontier ratio, which tells how similaracountry´s economic practices are to global best practices, has improved in nine out of 10 categories.Also, it is now among the top 30 nations in three categories —getting electricity, securing credit and protecting minority investors.However, the World Bank noted that India lagged in areas such as startingabusiness, enforcing contracts, and dealing with construction permits.

"The systematic reforms by the country inapersistent manner have paid off," said Annette Dixon, vicepresident for the South Asian region, World Bank.The multilateral agency has recognised reforms by the government in eight subcategories.It said the country had adopted 37 reforms since 2003.

"Nearly half of these reforms have been implemented in the last four years," it said. The Narendra Modi government has been in power for the past three andahalf years.The World Bank did not specifically ask respondents about the implications of the GST.
It said the tax was not an issue mentioned byamajority of the respondents but added that it would haveasignificant bearing on India´s rankings over the next few years.

In the protecting minority investors, India is now the fourth best country in the world,ajump from the 13th place last year.The passage and implementation of the Insolvency and Bankruptcy Code (IBC) as well as setting up of sectoral regulators saw India climb 33 notches in the parameter for resolving insolvency.In access to credit, the country improved its ranking by 15 places to 29. Here, too, the insolvency process playedakey role. However, despite hoping to bagabetter rank in the securing construction permits category, India only improved to 181 from 184

The report has not taken into account the government´s demonetisation drive, which has led to widespread disruption in business and has also pulled down economic growth.It didn´t consider the goods and services tax either.Junaid Ahmad, country director of the World Bank, said they were not factored in because the report only took into account comparable factors across the world.

Vedanta Group Chairman Anil Agarwal said the robust rise showed the reforms by the government were finally bearing fruit, making India one of the most compelling investment destinations globally.

The Business Standard, New Delhi, Ist November 2017