India Jumps Up the rank for Ease of Doing Business Global Ranking

Achievements & Initiatives of government towards Ease of Doing Business

India is one of the fastest growing global economies in the world. With a surge in digitisation, there have been several initiatives by the government towards improving the ease of doing business. All these initiatives have positively impacted the economy and India has jumped up several ranks in the World Bank’s Ease of Doing Business ranking in the last few years. The World Bank earlier this year said that India is expected to be the fastest growing economy of the seven largest emerging-market and developing economies (EMDEs) though its economic growth is projected to slow to 6.9% in FY23 and 6.6% in FY24 from 8.7% in 2021-22.

Moris Media, India’s leading PR Boutique & Digital Marketing Agency explores the achievements and initiatives of the Indian government towards provisions in Ease of Doing Business.

Ease of Doing Business (EoDB) Index

Ease of Doing Business (EoDB) index is a ranking system designed by the World Bank Group. The research presents data for 190 global economies on the following 10 indicators of business regulation, an overall score of which is used to develop a EoDB ranking:

1. Starting a Business of all
2. Dealing with Construction Permits
3. Getting Electricity
4. Registering Property
5. Getting Credit
6. Protecting Minority Investors
7. Paying Taxes
8. Trading across Borders
9. Enforcing Contracts
10. Resolving Insolvency

India- EoDB Ranking

Among the chosen 190 countries, India ranked at the 63rd position in 2020 with an improvement in 67 ranks over three years.  India is gradually getting in the global eye and attracting focus for investments as well as business capitalists. Becoming the most attractive and thriving business destination, India has jumped 79 positions from 142nd rank in 2014 to 63rd in 2019 as per the “World Bank’s Ease of Doing Business Ranking.’

Major Achievements

Reduction in over 39,000 compliances and decriminalisation of over 3400 legal provisions has further enhanced and encouraged the business ecosystem of India.

India’s major achievements can be summarised as:

1. Construction Permits- With a much needed ease in obtaining permits and decrease in the number of procedures, India’s ranking in this parameter has improved significantly from 184 in 2014 to 27 in 2019.
2. Getting Electricity- India has made transformative progress in this parameter by securing a rank of 22 in 2019, improving from a rank of 137 in 2014. It just takes 53 days and 4 procedures for a business to gain an electricity connection in India.

Apart from this, India ranks 13 in Protecting Minority Investors and 25th in Getting Credit, amongst the 190 countries.

Central Government Initiatives

1. Single Window Clearance for starting a business
Obtaining permits and clearances for business set up can be a daunting task, with people running from pillar to post across multiple departments to obtain the required permits. With the initiation of a single window clearance, all the needed permits and clearances can be obtained from a single source of contact, thereby reducing the time and efforts required for businesses to start operations in India.

2. SPICe Plus
As a part of Government’s Ease of Doing Business initiative, Ministry of Corporate Affairs have incorporated a new web form called SPICe+ that collates and merges the details of PAN, Tax Deduction and Collection Account Number (TAN), Director Identification Number (DIN) for company incorporation.

3. Construction Permits
The process of obtaining Construction permits has become hassle free with the introduction of fast track approval systems by the Municipal Corporations of respective states, issuing building permits with features like Common Application Form (CAF), digital signatures and online scrutiny of building plans.

4. Labour Law Reforms
With the introduction of several Labour Law reforms, the government has eased and digitised the compliance process for companies. It has become easier for businesses to hire, recruit, manage taxes, filing returns and maintaining registers and records. By reducing the compliance burden on the companies, labour law compliance has become easier for them.

5. Paying Taxes
Corporate Tax has been reduced to 25% from 30% for mid-sized companies. With a robust IT infrastructure for paying taxes, the online return filing has become easier. The Goods and Services Tax (GST) offers a unified tax system replacing the direct multiple taxes levied by state and centre. It has simplified the tax structure in India and made it more transparent and regulated.

With several other measures and reforms underway, the initiatives taken up by the government are contributing to a sustainable and strong business environment in the country. The heart of these reforms has been rationalising and digitalising regulatory processes that encompasses a holistic business cycle, from start to end.