India jumps 30 ranks in ease of doing business World Bank report: FM

New Delhi: India today jumped 30 places to rank 100th in the World Bank’s ‘ease of doing business’ ranking, sending the jubilant government to vow to continue reforms that will help the country break into top 50 in coming years.

India, which was ranked 142nd when the Narendra Modi government took office in 2014 and 130th last year, is the only large country this year to have achieved such a significant shift on the back of reforms in taxation, construction permits, investor protection and bankruptcy resolution.

The World Bank said it is “one of the top 10 improvers in this year’s assessment, having implemented reforms in 8 out of 10 ‘doing business’ indicators.” This is the first time India has broken into top 100 nations.

Reacting to the development, Prime Minister Narendra Modi said the government is determined to further improve the rankings and scale greater economic growth with the mantra of ‘reform, perform and transform’.

He hailed as “historic” the jump in India’s ranking in ‘ease of doing business’ and said it was a result of “all-round & multi-sectoral reform push”.

Addressing the media in New Delhi, Finance Minister Arun Jaitley said, “This is the highest jump that we have made in doing business ranking and it is significant for India because for the last 3-4 years we are trying to improve upon all the 10 parameters (of ranking) so that it becomes easy to do business in India.”

In its annual report ‘Doing Business 2018: Reforming to Create Jobs’, the World Bank said that India’s ranking reflects nearly half of the 37 reforms, adopted since 2003, implemented in the last four years.

With June as cut-off for assessing business environment, the ranking does not take into account the landmark reform of Goods and Services Tax (GST), which from July 1 weaved the country of 1.3 billion into one market with one tax and removed inter-state barriers for trade. Also, demonetisation has not been covered in the report.

The ranking comes as a shot in the arm for the government that has been battling dissenting voices against the way GST was implemented and growth being hit, although temporarily, due to demonetisation of higher denomination currency.

“In 3 years, from 142 we have come to 100. And I think in those areas where we are still lagging behind, there is a sufficient amount of work in progress. There is a reason to believe that we have a capacity to further significantly improve our position,” Jaitley said.

Modi’s target of breaking into top 50, he said, is achievable.

“I believe this is doable and therefore these remaining 3 -4 areas where work has to be done we will be pushing it with all the greater force,” he added.

The parameters that witnessed improvement in 2016-17 were India making it faster for start business, reduction in procedures and time required to obtain building permit, easier access to credit, protecting minority investors, ease of paying taxes, trading across borders, enforcing contracts and making resolving insolvency easier, the World Bank said.

But it still lags in areas such as starting a business, enforcing contracts and dealing with construction permits.

It takes 30 days now to register a new business, down from 127 days 15 years ago, but “the number of procedures is still cumbersome for local entrepreneurs who still need to go through 12 procedures”, it said.

While India is now ranked 4th in the world on protecting investors (up from 13th last year), its ranking on ease of getting electricity has deteriorated from 26 last year to 29 this year.

Credit availability ranking has improved to 29 from 44 and ease of paying taxes has seen a jump to 119th position from 172nd previously.

“This is a major major jump,” Rita Ramalho, Acting Director for World Bank’s Global Indicators Group, told PTI in Washington, attributing the climb of 30 places to the series of reforms undertake by the Modi government since 2014.

The GST, which was implemented from July 1, will get reflected only in next year’s ‘ease of doing business’ report.

“GST reforms have not been counted this year. It would come into play for the report next year,” Ramalho said, adding that demonetisation was not covered.

India was ranked 130th for last two years.

According to the World Bank, New Zealand is the easiest place on the planet to do business, followed by Singapore, Denmark, South Korea and Hong Kong. The US and the UK are ranked 6th and 7th on the list.

Among BRICS countries, Russia tops the list with 35th position, followed by China which has retained its ranking at the 78th place for the second consecutive year. Brazil’s ranking is 125th.

The biggest surprise of this year, the authors of the report said, is India, which jumped 30 spots in one year by improving its score by 4.71 to 60.76 points. Brazil is the only BRICS nation that is behind India.

“India has improved a lot (this year), but there’s still room for improvement, So, I wouldn’t necessarily classify it as a nice place to do business yet, but definitely is in the right direction to become a nice place. It is much easier than it was two years ago,” Ramalho said.

Santiago Croci Downes, Acting Manager, Doing Business Unit at World Bank, said that in the 15 years’ history of this annual report, there have been only five countries like Georgia and Rwanda which made a massive jump in one year. But none of them were as big an economy as India.

Jaitley said the government was seriously taking up the 3-4 issues where India was still lagging behind to gain a “20 -30 point improvement in the next 1-2 years.”

“Reforms are a continuous process… The 3-4 areas where we haven’t been treated very high are all areas where significant amount of work is in progress and once its impact is shown on the ground, I’m sure it will be taken into consideration in next year’s ranking,” he said.

PM hails India’s historic jump in ‘Ease of Doing Business’ rankings

The Prime Minister, Shri Narendra Modi has hailed India’s historic jump of 30 ranks in the World Bank’s Doing Business Report, 2018 released today. India’s rank has risen to 100 in the latest report compared to 130 in the Doing Business Report, 2017.

While terming the improvement in the rankings as historic, the Prime Minister in a series of tweets, said that the jump is the outcome of the all-round and multi-sectoral reform push of Team India.

“Historic jump in ‘Ease of Doing Business’ rankings is the outcome of the all-round & multi-sectoral reform push of Team India.

Easier business environment is leading to historic opportunities for our entrepreneurs, particularly MSME sector & bringing more prosperity.

Over the last 3 years we have seen a spirit of positive competition among states towards making business easier. This has been beneficial.

It has never been easier to do business in India. India welcomes the world to explore economic opportunities our nation has to offer!

Guided by the Mantra of ‘Reform, Perform & Transform’ we are determined to further improve our rankings & scale greater economic growth.”, the Prime Minister said.

India’s rank rises to 100 in World Bank’s doing Business Report, 2018

The World Bank, today released the Doing Business (DB) Report, 2018. The Department of Industrial Policy and Promotion (DIPP) is pleased to announce that India ranks 100 among 190 countries assessed by the Doing Business Team. India has leapt 30 ranks over its rank of 130 in the Doing Business Report 2017.

The DB Report is an assessment of 190 economies and covers 10 indicators which span the lifecycle of a business. The table below provides a comparison of this year’s and last year’s report. India has improved its rank in 6 out of 10 indicators and has moved closer to international best practices (Distance to Frontier score). The credit for this significant improvement is credited to the mantra of “Reform, Perform, Transform” given by the Prime Minister, wherein a strong leadership has provided the political will to carry out comprehensive and complex reforms, supported by a bureaucracy committed to perform. The Government has undertaken an extensive exercise of stakeholder consultations, identification of user needs, government process re-engineering to match Government rules and procedures with user expectations and streamlined them to create a more conducive business environment. An extensive exercise is also undertaken to increase awareness among users about reforms to ensure extensive use of newly created systems.

This edition of the report acknowledges India as a top improver, with an improvement of 30 ranks compared to last year’s report, the highest jump in rank of any country in the DB Report, 2018. India is the only country in South Asia and BRICS economies to feature among most improved economies of the DB Report this year.

2. Major achievements in the World Bank in the Doing Business Report

The important highlights of India’s performance are:

1. Resolving Insolvency –

a. Rank improved from 136 to 103

b. Distance to Frontier (DTF) score improved from 32.75 to 40.75

c. Strength of insolvency framework index increased from 6 to 8.5

d. Insolvency & Bankruptcy Code created for efficient handling of restructuring & insolvency proceedings

e. Professional institutes set up for handling restructuring & insolvency proceedings

2. Paying Taxes –

a. Rank improved from 172 to 119

b. DTF score improved from 46.58 to 66.06

c. Payments reduced from 25 to 13 in a year

d. Time reduced from 241 to 214 hours

e. Total tax rate reduced from 60.6% to 55.3% (% of profit)

f. Post filing index improved from 4.3 to 49.31

g. Enabled electronic registration, return & payment of ESI & EPF contributions

3. Getting Credit –

a. Rank improved from 44 to 29

b. DTF score improved from 65 to 75

c. Strength of legal rights index improved from 6 to 8

d. Credit bureau coverage increased from 21.4% to 43.5% (% of adults)

e. Increased coverage of security interest registration under SARFAESI Act

f. Secured creditors prioritized over Government dues for purposes of recovery

4. Enforcing Contracts –

a. Rank improved from 172 to 164

b. DTF score improved from 35.19 to 40.76

c. Cost reduced from 39.6% to 31% (% of claim)

d. Quality of judicial process index improved from 9 to 10.3

e. Dedicated commercial courts established

f. National Judicial Data Grid (NJDG) to monitor and manage court cases

5. Protecting Minority Investors –

a. Rank improved from 13 to 4

b. DTF score improved from 73.33 to 80

c. Strength of minority investor protection index increased from 7.3 to 8

d. Extent of conflict of interest regulation index increased from 6.7 to 7.3

e. Extent of shareholder governance index increased from 8 to 8.7

f. Greater transparency requirements for interested parties transactions

g. Greater shareholder protection through action against directors & claims for damages

6. Construction Permits –

a. Rank improved from 185 to 181

b. DTF score improved from 32.83 to 38.80

c. Procedures to obtain construction permits reduced from 35.1 to 30.1

d. Time reduced from 190.0 to 143.9 days

e. Cost reduced from 25.9 per cent to 23.2 per cent of warehouse value