Andhra Pradesh and Telengana have jointly topped the 2016 all-India State/Union Territory-wise Ease of Doing Business rankings, while last-year's topper Gujarat slipped to the third spot.
The rankings, announced on Monday by Commerce and Industry Minister Nirmala Sitharaman, are on the basis of a 340-point business reform action plan and their implementation by the States. This covers the period from July 1, 2015 to June 30, 2016.
Meanwhile, the World Bank said what was interesting this year was that four of the seven states with the lowest income levels in India have found a place in the top ten ranks, while all the seven such states had an implementation rate of over 75 per cent.
These low-income states included Chhattisgarh (97.32 per cent implementation rate regarding the 340 reform measures, and fourth rank), Madhya Pradesh (97.01 per cent and fifth), Jharkhand (96.57 per cent and seventh), Rajasthan (96.43 per cent and eighth), Odisha (92.73 and 11th), Uttar Pradesh (84.52 per cent and 14th), Bihar (75.82 per cent and 16th rank).
The Bank, along with the Centre's Department of Industrial Policy & Promotion (DIPP) was involved in the process of reviewing the evidence submitted by states/UTs regarding implementation of reforms for the rankings.
The World Bank said it was looking into India's suggestion that the World Bank Group's global Doing Business rankings need to consider reforms undertaken across the country and not just in Mumbai and Delhi as is being done currently.
India's rank in the recently released global Doing Business rankings was a lowly 130th, just one rank up from the previous year's 'revised' ranking of 131st. Prime Minister Modi is keen to ensure that India finds a place in the top 50 countries within a year or two.
The World Bank is learning that one size does not fit big and diverse countries like India, said the World Bank's new Country Director for India, Junaid Ahmad, speaking on the occasion. Ahmad said other large nations like Brazil and Russia have also moved from a focus at the Central level to a sub-national level, like India. Brazil and Russia have requested more exchanges with India to learn about the best practices, he added.
Commenting on the sub-national rankings,Ms. Sitharaman said: "While last year only seven States had implemented over 50 per cent of the total reform points and no State had an implementation percentage of over 75 per cent, this year saw 17 States crossing the 50 per cent implementation mark and 16 states have an implementation percentage of over 75 per cent."
The national implementation average stands at 48.93 per cent, significantly higher than last year's national average of 32 per cent, according to a DIPP statement. This demonstrates the great progress made by States this year, said the statement.
Ms. Sitharaman said, “There is a healthy competition among States on ease of doing business. This exercise is an important aspect in the government's agenda to transform India. We are now looking at broad-basing the reform drive.”
The 340 reform areas are broadly under categories including construction permit, environmental and labour registration, obtaining electricity connection, online tax-return filing, inspection reform, access to information and transparency, single window, land availability and commercial dispute resolution. The Centre plans to soon hold meetings with states soon to make changes in the reform areas through addition and deletion of certain reform areas.
The top ten ranks in 2016 included Andhra Pradesh & Telengana (98.78 per cent each implementation rate), followed by Gujarat (98.21 per cent), Chhattisgarh (97.32 per cent), Madhya Pradesh (97.01 per cent), Haryana (96.95 per cent), Jharkhand (96.57 per cent), Rajasthan (96.43 per cent), Uttarakhand (96.13 per cent) and Maharashtra (92.86 per cent).
At least 32 States and Union Territories submitted evidence of implementation of 7,124 reforms, a DIPP statement said. These submissions were reviewed by the World Bank team and validated by the DIPP.
The laggards falling in the “jump start needed” category with an implementation percentage of 0-40 per cent include Kerala, Goa, Tripura, Daman and Diu, Assam, Dadra and Nagar Haveli, Puducherry, Nagaland, Manipur, Mizoram, Sikkim, Arunachal Pradesh, Jammu and Kashmir, Chandigarh, Meghalaya , Andaman and Nicobar Islands, and Lakshadweep.
The 'leaders' category with an implementation percentage of 90-100 per cent include the top ten ranked states and Odisha and Punjab (91.07 per cent). The next category of 'aspiring leaders' with an implementation rate of 70-90 per cent include Karnataka, Uttar Pradesh, West Bengal and Bihar. This is followed by the 'acceleration required' category that include Himachal Pradesh, Tamil Nadu and Delhi.