Finance minister Arun Jaitley on Sunday said the Doing Business report of the World Bank does not fully reflect the steps taken by the government in the last 17 months and the country’s ranking could have been “significantly higher”.
Noting the 12-position jump in India’s ranking in the Doing Business report 2016 of the World Bank, the finance minister said that even though the push up numerically is modest, “it marks the reversal of an adverse trend.”
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“I understand that all steps have not been factored in since the World Bank criteria has a cut-off date and it also waits for announcements to translate into action before they can be factored. Quicker decision making, faster policy changes, eliminating corruption at the top and smoother clearances have played a significant role. The FIPB clearances and the environmental approvals are being routinely granted. Investors no longer queue up before the Mantralayas in Delhi lobbying for policy changes or approvals,” Jaitley said in a Facebook blog post.
Acknowledging the need to further cut down on number of permissions so that the time-lag between the decision to invest and the actual investment can be shortened significantly, he also made a case for examining whether some of the conditionalities for FDI have become “anachronic”.
“States must realise that local laws which enable availability of land, environmental permissions, sanction of building plans need a relook. Once an industrial zone or new township has been cleared for environmental sanctions, should individual structures require a separate environmental approval?,” the finance minister said while emphasising that these additional changes will further
improve India’s ranking for ease of doing business.
According to the World Bank report, India moved to 130th position out of 189 countries in 2016 in ease of doing business, up 12 places from 142nd last year.
Pointing out to the fact that states have also altered their work culture, he said that the states are increasingly realising that easier environment of doing business attracts business and investments.
“Competitive federalism can be seen. The Gujarat model of Global Investors Meet has been replicated in Tamil Nadu, Madhya Pradesh, West Bengal and in Punjab. Rajasthan, this month, would be wooing global investors. Telangana and Andhra Pradesh have been reaching out to investors globally. Three states with a significant tribal population – Chhattisgarh, Jharkhand and Odisha, figure in the top six states in the World Bank Ease of Doing Business rankings. The work culture is changing in most States,” the finance minister said.
He also added that the government is also looking at making exit of the businesses easier for which “the framework of the bankruptcy law is being readied. Dispute resolution with regard to public projects requires a quicker settlement mechanism. The same is being worked out.”
“To add a percentage or two in our present growth rate, the ease of doing business coupled with a simpler direct and indirect taxation system, a higher investment in infrastructure and irrigation will play a significant role. A low oil and commodity regime is helping us in this direction,” the finance minister added.