Karnataka tops in investments, but plummets in ease of doing business

November 03, 2016 12:00 am | Updated December 02, 2016 01:10 pm IST - BENGALURU:

Even as Karnataka has been ranked first in the country in attracting investments — leaving Gujarat a distant second — three key departments (Urban Development, Revenue, and Law) have pulled down the State’s overall ranking in ease of doing business owing to procedural delays and laxity in the administration.

Karnataka’s ranking has slipped from 9th in 2015 to 13th in the 2016 All-India State/Union Territory-wise Ease of Doing Business Ranking. Of the 340 parameters fixed by the Centre’s Department of Industrial Policy and Promotion, the State has met 301. Though the State has met an additional 25 parameters, the DIPP and the World Bank have not accepted them citing technical reasons.

Karnataka received investments of Rs. 1,09,773 crore during January–July 2016, while Gujarat received Rs. 39,754 crore, taking the second spot. Andhra Pradesh received investments of Rs. 10,848 crore, Madhya Pradesh Rs. 5,087 crore, Odisha Rs. 4,305 crore, and Telangana Rs. 16,330 crore during the same period.

Despite receiving relatively negligible investments when compared with Karnataka, Andhra Pradesh and Telengana have jointly topped the ease of doing business ranking on 2016, while Gujarat has secured the third spot.

The delivery of services, non-implementation of online services, procedural delays in approving building plans, construction plans and other sanction plans by the Urban Development; and too many procedures in registration of properties in the Revenue Department were the major reasons for the slip in this year’s ranking.

Addressing presspersons here on Wednesday at a departmental review meeting, Minister for Industries R.V. Deshpande said eight steps are needed for approving building plans, approvals etc. by agencies such as Bangalore Development Authority, the BBMP, urban local bodies, and municipal agencies. Reduction of steps and online approvals of plans would improve the State’s ranking, he said.

‘Change parameters’

The Minister urged Union Minister of State for Commerce and Industry Nirmala Sitharaman to change the parameters for ranking the States. Overall business friendly ecosystem developed by the State, labour situation, availability of infrastructure and manpower, receipt of investments, and number of projects implemented should be taken into consideration, he said.

Ms. Sitharaman has called a meeting on November 16 and he would be using the occasion to raise these issues, Mr. Deshpande said.

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