Skip to main content

India slips in World Bank ranking on starting business, registering property; overall 30 point jump is from pre-GST data

Ease of doing business ranking: Blue 2018, Red 2017
By Rajiv Shah
Prime Minister Narendra Modi may have tried to extract political capital out of the 30 point jump noted in the World Bank’s latest Ease of Doing Business report, calling the 100th ranking among 190 countries “historic”, a result of what he called “all-round and multi-sectoral reform push of Team India”, but a comparison with the last year’s report suggests there is little cheer about it.
In fact, India’s ranking in what could be considered as perhaps the most important factor for calculating ease of doing business, “starting a business”, has actually slipped by one point, from 155th to 156th. In yet another factor, which could be considered equally significant, "registering property", India’s ranking has slipped even more – from 138 to 154.
While the World Bank also notes slip in two other factors, “getting electricity” from 26 to 29 and “trading across borders” from 143 to 146, in a few other factors, the improvement is not as drastic – for instance, the ranking was 185th in “dealing with construction permits” last year, which reached 181st this year, and “enforcing contracts” it was 172nd and has come up to 164th.
Interestingly, the biggest jump in ease of doing business, from 172 to 119, a 50 point jump, is the factor “paying taxes”.
It is, however, not known how the World Bank experts – who depended on their data for the period up to June 2017 – would react to this factor now, as the new tax regime, Goods and Services Tax (GST), began being implemented in India on July 1, 2017. GST is known to be facing all-round opposition from virtually all sections of the business for being implemented in an extremely roughshod manner.
Tax payment analysis is based on pre-GST data 
There is also an improvement in a few other factors – such as “getting credit”, from 44th to 29th, “protecting minority investors” from 13th to 4th, and “resolving solvency”, from 136 to 103.
Interestingly, a comparison between the eight countries covered for the South Asia region – Bhutan, India, Nepal, Sri Lanka, Maldives, Pakistan, Bangladesh and Afghanistan – suggests that, insofar as the factor “starting a business” is concerned, India ranks 8th, worse than even the backward Afghanistan, which ranks 7th.
While overall India is found to be ranking No 2nd in the region (Bhutan is No 1), in “dealing with construction permits” India ranks 7th, as against Pakistan 5th and Bangladesh 4th. Further, India ranks 5th in “enforcing contracts” as against Pakistan’s 4th; 4th in “resolving insolvency” and “trading across border”, 3rd in paying taxes, and 1st in “getting electricity”, “getting credit” and “protecting minority investors”.
Titled “Doing Business 2018: Reforming to Create Jobs”, the new World Bank report praises India for standing out this year “as one of the 10 economies that improved the most in the areas measured by Doing Business”, other countries being Brunei Darussalam, Thailand, Malawi, Kosovo, Uzbekistan, Zambia, Nigeria, Djibouti and El Salvador.
Even as pointing out that India is among the “top improvers”, along with Brunei Darussalam and Thailand, for implementing “the highest number of business regulation reforms in 2016/17”, the World Bank does not fail to note “inefficient licensing and size restrictions cause a misallocation of resources, reducing total factor productivity by preventing efficient firms from achieving their optimal scale and allowing inefficient firms to remain in the market.”

Comments

Uma Sheth said…
Till now no one bothered about this report - in fact, most people had not even heard of its annual release. That is why it is easy for the government to hoodwink the public - no one bothers to clarify that the report is from July 2016 to June 2017 and therefore the effects of demonitisation and shoddy implementation of GST are not taken into account.

Let us see what happens next year.

TRENDING

Whistle-blowing IPS officer Sanjiv Bhatt's wife suspects foul play after truck hits her car

By Nachiketa Desai*
Paranoia has seized Shweta Bhatt, wife of suspended Indian Police Service (IPS) officer Sanjiv Bhatt, after the car she was driving was rammed in broad day light. According to Shweta Bhatt, it was beacon light-flashing truck without registration number plate. The incident took place on January 7, just a day ahead of the Gujarat High Court was scheduled to take up the bail application of Sanjiv Bhatt, arrested last year for "involvement" in a 23-year-old case.

Call to support IIM-Bangalore professor, censured for seeking action against Uniliver

Counterview Desk
Sections of the Indian Institute of Managements (IIMs) across India have strongly reacted to the decision to censure Dr Deepak Malghan, a faulty at IIM-Bangalore. Prabhir Vishnu Poruthiyil, who is faculty at IIM-Tiruchirapalli, has sought wider solidarity with Dr Malghan, saying, "The administration has censured Deepak for merely suggesting a meaningful action against Hindustan Unilever for their abysmal environmental record" by “disinviting” it for campus placement.

Morari Bapu, who has installed new statues of Ram, Laxman, Hanuman without weapons

By Sandeep Pandey*
A saint is one who can give some inner peace by his/her voice. This will happen only when s(he) will talk about love and harmony. Morari Bapu is one saint who has been conveying the message of love, peace, harmony, fraternity, etc. Today when a number of saffron clad figures with aggressive posture, spewing venom, fanning hatred to polarise voters are at the forefront of politics of Hindutva it is a relief to see Morari Bapu in a different mould.

Rejoinder: Worldwide anxiety post-Fukishima is fading, slowly and steadily

By Dr KS Parthasarathy* 
EAS Sarma, former Secretary, Government of India (GoI) in a letter addressed to the Secretary, Department of Atomic Energy (DAE), GoI, stated that, there has been "worldwide anxiety about the consequences of catastrophic nuclear accidents, either due to manual lapses or natural calamities" (Counterview, December 2, 2018). "In the recent years, globally, the pace of growth of nuclear power has escalated in leaps and bounds, causing a great deal of public concern and apprehension."

99% MGNREGA funds "exhausted", Govt of India makes no additional sanctions: Study

Counterview Desk
A letter, addressed to Prime Minister Narendra Modi, and prepared by senior activists led by Aruna Roy on behalf of the Peoples’ Action for Employment Guarantee (PAEG), and signed, among others, by 80 members of Parliament, has regretted that, despite repeated public statements by his government promising employment and job creation that will boost the country’s growth, the country’s only employment guarantee programme, Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA), “is being systematically undermined.”

Nuclear reactors sought from French giant "not safe": Letter to Modi on Jaitapur project

Counterview Desk
Amidst reports that the French nuclear giant EDF has submitted a “techno-commercial offer” for the world’s largest nuclear power park proposed in Maharashtra’s Jaitapur nuclear power park in Jaitapur on the Maharashtra coast, Dr EAS Sarma, India’s former Union Secretary in the Minister of Power, and an eminent voice in the civil society, has written an open letter to Prime Minister Narendra Modi, who also heads Department of Atomic Energy (DAE),  protesting the move.

World Bank clarifies: Its 26th rank to India not for universal access to power but for ease of doing business

By Our Representative
In a major embarrassment to the Government of India, the World Bank has reportedly clarified that it has not ranked India 26th out of 130 countries for providing power to its population. The top international banker’s clarification comes following Union Power Minister Piyush Goyal’s claim that India has “improved to 26 position from 99” in access to electricity in just one year.

Kerala land being acquired using "draconian, anti-people" National Highway Act, 1956

Counterview Desk
In a letter Chief Minister of Kerala Pinarayi Vijayan, senior activists and politicians have insisted that the Kerala government should not agree to "inhuman displacement and buid-operate-transfer (BOT) Toll system", imposed by the Government of India and the National Highway Authority of India, for widening the current National Highway (NH) 66.

Kaiga NPP expansion: Karnataka to get just 400 MW, but lose thick forest, fresh water

Counterview Desk
In an open letter to the chairman and members of the Atomic energy Commission (AEC) on the issue of Kaiga nuclear power plant (NPP) expansion plan in Karnataka, Shankar Sharma, well-known power policy analyst, has argued that that in case of expansion, the site will face “exponential increase in radiation emission risks”, underlining, “Nuclear safety experts identify such a scenario as enhanced risk for NPPs with multiple reactors and shared technical facilities."
Sharma says the questions that also be asked whether Karnataka should lose more than 54 hectares of thick forests and about 152,304 cubic meters of fresh water per day from Kali river for a meager benefit of 400 MW from the Kaiga NPP, for which “there are many benign alternative options available for the state at much lower overall costs to the state.”
Text of the letter: This has reference to the public hearing under the Environmental Impact Assessment (EIA) Rule 2006 of Ministry of Environment, Fore…

Uttarakhand High Court: Biodiversity boards can impose fees on Ramdev's Divya Pharmacy

By Mridhu Tandon
In a significant decision, the Uttarakhand High Court on December 21, 2018 has dismissed the writ petition filed by Divya Pharmacy founded by Baba Ramdev and Acharya Balakrishnan, challenging the demand of the Uttarakhand Biodiversity Board (UBB) imposing fees under the provisions of the Fair and Equitable Benefit Sharing (FEBS).