{"id":34169,"date":"2018-10-30T16:10:47","date_gmt":"2018-10-30T10:40:47","guid":{"rendered":"https:\/\/blog.forumias.com\/?p=34169"},"modified":"2018-10-30T16:10:47","modified_gmt":"2018-10-30T10:40:47","slug":"india-is-right-to-focus-on-ease-of-doing-business","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/india-is-right-to-focus-on-ease-of-doing-business\/","title":{"rendered":"India is right to focus on ease of doing business:\u00a0"},"content":{"rendered":"<p><a href=\"http:\/\/www.livemint.com\/Opinion\/qQhq44ebYHrfbwGmBhnAMK\/India-is-right-to-focus-on-ease-of-doing-business.html\"><span style=\"font-weight: 400;\">India is right to focus on ease of doing business<\/span><\/a><span style=\"font-weight: 400;\">:\u00a0<\/span><\/p>\n<p><b>Context<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><b>The World Bank Group\u2019s Doing Business 2018 <\/b><span style=\"font-weight: 400;\">report <\/span><b>ranks India at 100 out of 190 countries<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\"> India\u2019s jump in ease of doing business rankings will hopefully be a spur for further reforms, for a better business environment and greater prosperity for all<\/span><\/li>\n<\/ul>\n<p><b>What is Distance to Frontier?<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The distance to frontier score helps assess the absolute level of regulatory performance overtime.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">It measures the distance of each economy to the \u201cfrontier\u201d, which represents the best performance observed on each of the indicators across the economies in the Doing Business sample since 2005.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">An economy\u2019s distance t frontier is reflected on a scale from 0 to 100, where o represents the lowest performance and 100 represents the frontier.<\/span><\/li>\n<\/ul>\n<p><b>What is Ease of Doing Business Index?<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The Ease of doing business index is an index released by the World Bank Group in its Doing business report.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Higher rankings indicate better, usually simpler, regulations for businesses and stronger protections of property rights.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">New Zealand has topped the Ease of Doing Business rankings in 2017.<\/span><\/li>\n<\/ul>\n<p><b>Where does India stand in the Ease of doing business index?<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">India ranked 130 among 190 countries however, has not made any improvement from the last year as its rank has been downgraded to 131.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">This lack of improvement in the rankings though Indian Government was hoping to jump substantially this year has triggered a strong reaction and disappointment.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Though several reform measures have been taken by the Government, it feels they are not reflected in these rankings.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The only bright side in these rankings is that India has improved substantially in getting electricity for businesses and enforcing contracts.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Out of the 10 parameters, India has slipped down in 5 parameters and on other 3, there is a status quo.<\/span><\/li>\n<\/ul>\n<p><b>Why India should not base its result on basis of this index?<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">World Bank index is based on limited data.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">There is a disjunction between how things get done in India and Bank\u2019s methodological approach. Many achievements have not been covered by the report due to methodological issues.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">According to DIPP, Online filing and payment of returns at the Employee Provident Fund Organization has been implemented, but it was not considered by the World Bank, even after it shared \u201clogs and voluminous evidence\u201d of the same.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Bank\u2019s report is based on data collected from very few cities.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Centre has only partial control over several of these sub-indices as it needs states support to bring the required legislations.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">It does not directly measure more general conditions such as a nation\u2019s proximity to large markets, quality of infrastructure, inflation, or crime.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">Rankings are incompletely reflective of the significant transformation in the overall business environment in key areas such as openness to FDI, online procedures, MSME facilitation<\/span><\/li>\n<\/ul>\n<p><b>What are the loopholes in the ease of doing business index?<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">In India\u2019s case, the business environment in only Delhi and Mumbai are used to compile the national ranking.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">These rankings also focus a lot more on the laws and rules that are on the books and do not necessarily capture the daily experiences of businesses.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The World Bank said while there has been substantial progress, India still lags in areas such as starting a business (156), enforcing contracts (164) and dealing with construction permits (181).<\/span><\/li>\n<\/ul>\n<p><b>Larger challenges<\/b><\/p>\n<ul>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The <\/span><b>enforcement of contracts<\/b><span style=\"font-weight: 400;\"> now takes longer than it did 15 years ago.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">The <\/span><b>procedures to start a business<\/b><span style=\"font-weight: 400;\"> or <\/span><b>secure a construction permit<\/b><span style=\"font-weight: 400;\"> remain cumbersome.<\/span><\/li>\n<li style=\"font-weight: 400;\"><b>Mumbai and Delhi cannot<\/b><span style=\"font-weight: 400;\"> host the kind of <\/span><b>large factories<\/b><span style=\"font-weight: 400;\"> that India needs to generate adequate employment.<\/span><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">It is critical to have <\/span><b>procedural reforms reach the surroundings<\/b><span style=\"font-weight: 400;\"> and a <\/span><b>road map be drafted for the larger legislative changes <\/b><span style=\"font-weight: 400;\">needed in matters such as <\/span><b>land acquisition.<\/b><\/li>\n<li style=\"font-weight: 400;\"><span style=\"font-weight: 400;\">While foreign investors are important, the importance of <\/span><b>domestic businesses cannot be ignored<\/b><span style=\"font-weight: 400;\">.<\/span><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>India is right to focus on ease of doing business:\u00a0 Context The World Bank Group\u2019s Doing Business 2018 report ranks India at 100 out of 190 countries. India\u2019s jump in ease of doing business rankings will hopefully be a spur for further reforms, for a better business environment and greater prosperity for all What is&hellip; <a class=\"more-link\" href=\"https:\/\/forumias.com\/blog\/india-is-right-to-focus-on-ease-of-doing-business\/\">Continue reading <span class=\"screen-reader-text\">India is right to focus on ease of doing business:\u00a0<\/span><\/a><\/p>\n","protected":false},"author":61,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[555],"tags":[],"class_list":["post-34169","post","type-post","status-publish","format-standard","hentry","category-test-1","entry"],"jetpack_featured_media_url":"","views":{"total":0,"cached_at":"","cached_date":1704866575},"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/34169","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/61"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=34169"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/34169\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=34169"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=34169"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=34169"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}