India moves up 30 spots in WB’s ease of business ranking

Nation made big efforts in last 3 years and what is seen in this report is not last year’s reforms only: Rita Ramalho of WB

October 31, 2017 07:39 pm | Updated December 03, 2021 10:36 am IST - Washington:

India climbed 30 positions in the latest ease of doing business ranking by the World Bank, in its Doing Business 2018 report released on Tuesday. The report ranks India at 100 among 190 countries. Last year, India was ranked 130.


Improving India’s ranking in the report has been a key component of PM Narendra Modi’s economic agenda.

“..Indian government has been focussed on reforms and since the Modi government came into office, it began looking at this area, trying to understand what we measure, how we measure, what is the value of it and designed a reform programme that addresses some of the shortcomings that were measured by the indicators and this is the result of that..these things take some time to come into fruition,” Ms. Ramalho said.  “India made big efforts in the last three years and what is seen in this report is not last year’s reforms only,” she said, adding that the methodology of the study captures the actual implementation of a particular reform once it is enacted, resulting in a time lag before it is reflected in the report. 

India’s upward jump in ranking is based on the underlying improvement in the distance to frontier (DTF) score — an absolute measure of progress towards the best practice - in the report. India recorded the fifth highest change in DTF score and found a place for the first time in the top ten economies improving the most in a given year, in the report which is into its 15th edition. The ease of doing business ranking compares economies with one another; the DTF score benchmarks economies with respect to regulatory best practice. Ms. Ramalho described India’s progress on both counts “high and rare.”

Doing Business  report measures aspects of regulation affecting 11 areas of the life of a business, and India made eight reforms across these areas last year, the highest number for the country in a single year.  India is one of the three countries last year that undertook reforms in as many as eight areas. 

Faster permits for construction, combining the application for the Permanent Account Number (PAN) and the Tax Account Number (TAN) into a single submission, reduction in the time needed to complete the applications for Employee’s Provident Fund Organization (EPFO) and the Employee’s State Insurance Corporation (ESIC), reduction in export and import border compliance costs and improved access to credit are among the reforms noted by the report. “…the establishment of debt recovery tribunals reduced non-performing loans by 28% and lowered interest rates on larger loans, suggesting that faster processing of debt recovery cases cut the cost of credit,” the report said.


India is now in the middle of the list, moving up from the last quarter but still it is at a place where there is scope for improvement, the WB official said. “There are still significant changes possible, though the change this year is significant, both in relative and absolute terms,” she said. 

India used to be the last among the BRICS - Brazil, Russia, India, China, South Africa -  countries in the ranking, but now it has overtaken Brazil in the list.  China maintained the same ranking it had last year, at 78. New Zealand, Singapore and Denmark retained their first, second and third spots. Russia, at 35 is the best among BRICS countries; while Brazil is now the last. 

Bank officials said enforcement of contract is one area of concern in India. The time to enforce a contract has only become longer today, at 1445 days compared to 1420 days 15 years ago, placing India at 164th place in the ranking on Enforcing Contracts indicator.  Property registration and property transition, land registry and administration remain complicated in India compared to many other countries. India has reduced the time to register a new business to 30 days now, from 127 days 15 years ago. Still, local entrepreneurs in Mumbai need to go through 12 procedures to start a business in Mumbai which is considerably more than in OECD countries where it takes five procedures on average. “This is a marathon and not a sprint; patience is a virtue here. What you see here is the result of years of work,” said Santiago Croci Acting Manager of Doing Business Unit at the WB.

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