Kerala’s reform efforts, aimed at providing faster licences to industries and digitising the banking system, have helped the state sharply improve its position in the Business Reforms Action Plan (BRAP) reforms rankings, P Rajeev, Kerala’s Minister for Industries and Law, told The Indian Express. Under the BRAP, the Union Ministry of Commerce and Industry ranks states and Union Territories based on the regulatory environment and reform friendliness.
The only state in the country ruled by a Left front government and one that has for long been identified with militant trade unionism, Kerala jumped to the top spot in the 2022 Commerce Ministry rankings released last week, up sharply from 16th position in 2021. The BRAP exercise assesses states on several parameters such as transparency, efficiency, and effectiveness of the regulatory framework and services for businesses, before an overall ranking is accorded.
“We managed to improve our position from 22nd to 16th in 2021. At that time, we scored 80 per cent in the business reforms category, as well as in feedback. Last year, our major shortcoming was in the feedback section. We had taken several steps to simplify the process, but our position in feedback was poor. This time, we have improved both in business and investment reforms, as well as in the survey, where we received a good response from industries,” Rajeev said.
Legislation to attract investment
Regarding reforms, the state minister said that the government directly engaged with over 500 industries before formulating policies, seeking their opinions on how to encourage investment and boost job creation. “Following this, we formulated legislation allowing anyone with an investment of Rs 50 crore to start an industry in Kerala without requiring a licence for three years,” the minister said.
“We have introduced another piece of legislation that grants a licence to non-MSME industries within seven days of submitting an application, provided all relevant documents are in order,” he added.
The industry minister also highlighted that a statutory grievance redressal mechanism has been established to promote transparency, with the authority to take disciplinary action against government officials for lapses. He added that Kerala’s digitisation efforts in the banking system also contributed to the state’s improved ranking.
Focus on knowledge-based industries
Given Kerala’s limited availability of land, the minister emphasised the state’s focus is on knowledge-based industries, which align with its strengths in terms of its growing human resources.
“Knowledge-based industries are a priority in the state’s policy. We are working to transform Kerala into a hub for technology manufacturing, as well as a centre for IT, Artificial Intelligence, and automotive technology,” he said.
The minister said that starting a manufacturing industry in Kerala would mean depending on migrant labour, which isn’t as beneficial to Kerala’s economy. However, in the knowledge economy, most of the workers are from the state, and the salaries are much higher, which also generates indirect employment, Rajeev said.
Least corrupt state in India
Responding to accusations of corruption faced by the CPI (M)-led government, Rajeev said that Kerala is the least corrupt state in the country according to official data. “There are isolated issues, but the government can handle such matters. In the industrial sector, we are working to digitise systems to improve transparency. Political and labour issues in Kerala are also very peaceful,” he said.
P Rajeev, Kerala’s Minister for Industries and Law (File Photo) 
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