Published: Thu, November 01, 2018
Markets | By Josh Butler

India's war on red tape is working, says World Bank

India's war on red tape is working, says World Bank

India has jumped 23 places to the 77th position in the World Bank's "ease of doing business" ranking released Wednesday, in a development that comes as a shot-in-the-arm for the Narendra Modi government ahead of the 2019 general elections.

Overall, India has jumped 23 places to 77th rank in the rankings thanks to feedback from stakeholders that it is now significantly simpler to get construction permits and ship goods across the country's borders, among other things.

China and India - two economies with the largest populations - are among top 10 improvers this year.

The country is also said to have made strides in making it easier to deal with construction permits by reducing time for processing permit applications.

According to the "Doing Business 2019 - Training for Reforms" report, last year's reforms accelerated Turkey's efforts to improve the business climate for domestic small and medium enterprises (SMEs).

The report measures the performance in ease of doing business in 190 countries. "Starting a business central government and state governments have to work together". "It's a collaborative effort and a combination of several interventions that has resulted in improvement into this "Ease of doing Business" index".

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The government also introduced the reorganisation procedure and improved the continuation of the debtors' business during insolvency (bankruptcy) proceedings for Karachi and Lahore.

Marking areas where the country still needs to improve, Mr Jaitley mentioned starting of business, in which the country ranked 137, paying taxes and enforcing of contracts, which he said "remains poor". Last year, Israel was ranked 130th (and nearly last) for registering property, 99th for paying taxes, and 92nd for enforcing contracts. Governments around the world set a new record, implementing 314 business reforms over the past year, compared to 290 reforms implemented in the previous year. With Djibouti, which makes it to this list for the second consecutive year, Africa occupies half of the top 10 most improved economies list.

Briefing the media on the report, Executive Director Board of Investment, Fareena Mazhar explained that in addition to introduction of reforms, other positive data corrections also contributed to the unprecedented improvement in ranking of Pakistan. Improvements have already done on enforcement of contracts, taxation and insolvency laws and would be reflected in future rankings, he said. "India made paying taxes easier by replacing many indirect taxes with a single indirect tax, the GST, for the entire country".

Further, India reduced the time and cost of export and import through various initiatives, including the implementation of electronic sealing of containers, the upgrading of port infrastructure and allowing electronic submission of supporting documents with digital signatures, it said.

"Getting Electricity and Trading Across Borders also saw reforms in the two cities".

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