Centre to assess States on ease of doing business

The Dollar Business Bureau As part of efforts to improve India’s ranking in the ease of doing business index, the Central government has sought active participation from all state governments and directed them to align their policies to make this possible. The Centre has also decided to increase accountability by ranking each state on the basis of the ease of doing business in that particular state. Announcing this, Atul Chaturvedi, Joint Secretary, Department of Industrial Policy and Promotion (DIPP), said, “In June and July, the State governments will be assessed and ranked on ease of doing business in their respective states for which help was being sought from the World Bank and third party agencies.” Chaturvedi also expressed hope that the rankings, which would be declared by the end of July, would help individual states attract investment. It’s worth mentioning that one of the main objectives of the Modi government, ever since it stormed to power a year back, has been to improve India’s ranking in the World Bank index, where the country’s current ranking is an embarrassing 142nd. And one of the main reasons for such a poor showing is an outlier – 184th rank in the ‘dealing with construction permits’ component. Being a state subject, the Centre cannot do much in improving the country’s ranking in this area and hence, the improved focus on making individual states accountable. It’s also worth mentioning that while India’s overall ranking is often highlighted as an impediment for businesses, the country’s standings are very respectable when it comes to two components – protecting minority investors and getting credit – where its rankings are 7th and 36th respectively. In fact, a The Dollar Business Intelligence Unit analysis reveals that if these two outliers are removed, India’s ranking on the index would climb to No.119.    

May 27, 2015 | 5:33 pm IST.