India jumped 14 places to the 63rd position on the World Bank’s ease of doing business ranking as the government’s ‘Make in India’ scheme and other reforms attract foreign investment.
Also, for the third time in a row, the country figured among the top 10 performers on the list. The rankings come at a moment when the Reserve Bank of India (RBI), World Bank, International Monetary Fund (IMF) and other rating agencies have turned down the country’s growth forecasts amid a slowdown in the global economy.
But this achievement is not enough; it leaves a lot of room for improvement. India needs a fresh set of “bold reforms” in the next three to four years if it wants to be among the top 50 countries with ease of doing business.
As per Simeon Djankov, Director of Development Economics at the World Bank, with the current reform agenda that the bank is watching like Insolvency and Banking Code, enforcing contracts, tax reforms being completed next year or the year after, India can get within the top 50 or may be even in the 40.
Other economies like Latin America and Europe might give India a greater competition to move up the ladder in the ease of doing business report.
In order to improve beyond that and be able to compete with these rising economies, India needs a fresh set of reforms. India needs to ask, what it can do to from being in the top 50 to the top 25 economies, Djankov said.
Keeping this need in mind, India’s Finance Minister Nirmala Sitharaman said efforts will be made to further simplify Goods and Services Tax (GST), and expressed hope that it will help in further improving India’s ranking in the World Bank’s ease of doing business index.
She asserted that states too will have to make efforts in property registration for improving the business climate in India.
Furthermore, the Indian government has asked World Bank to represent India’s diversity and has asked to survey two more cities for Ease of Doing Business (EODB) rankings. Chief Economic Adviser Krishnamurthy Subramanian said the current outreach programme being undertaken by the banks has helped in improving credit access to the MSME sector.
Finance Minister Nirmala Sitharaman said that till now, only two cities used to be covered for ease of doing business rankings. We have asked World Bank to add Kolkata and Bengaluru in the list of cities to be surveyed for the rankings.
Implementation of Insolvency and Bankruptcy Code (IBC) might have helped in improving India’s ranking but China is proving a major competitor in World Economic Index and India needs to up its game in order to be at par with its neighbour.
Currently, the World Bank takes into account only Delhi and Mumbai but Nirmala Sitharaman has assured that in the next ranking, it will also include the business climate in Kolkata and Bangaluru.