Doing Business in India: Not Easy, But...
Despite undeniable progress, India is a country where it remains quite difficult to do business, as evidenced by the World Bank’s ranking. Yet, there are glimmers of hope! The Ease of doing business index, compiled by the World Bank indicates the ease – or difficulty – of doing business in different countries of the world. For example, the United States earns a score of 7, while the United Kingdom is awarded 8, and Russia 62. The champions? South Korea (5), Denmark (4), Hong Kong (3), New Zealand (2), and Singapore (1). At the bottom of the list we have countries like Senegal (171) and Guinea (169). Of course, the higher the score a country gets, the more it is considered difficult to do business there. The index developed by the World Bank is based on a variety of criteria, including the paperwork involved in exporting goods, “informal payments to public officials,” the number of internationally recognized quality certificates and the public and private investments in telecoms, energy and transportation.
And what about India, you may ask? Unfortunately, despite huge progress, particularly over the last decade, India’s performance regarding the ease of doing business is quite disappointing – 140, alongside with Mali (143) and Mozambique (142). This confirms the impression many people have, namely that conducting business in this country is still quite tedious and unpredictable! Among the main irritants are of course the bottlenecks created by bureaucratic formalities and what we could only describe as a different relation with the concept of time and timeliness, compared with countries that are at the top of the list. (By the way, it should be noted that a country like France does anything but deliver a stellar performance, for an “advanced” nation with 33, just behind Spain, while Germany earns a grade of 13.) However, there is a political will to improve the situation. For example, Dr. Ashis Kumar Das, Deputy Director General of Foreign Trade, Ministry of Commerce& Industry, considers that it is possible to enhance the "Ease of doing business", through a number of measures, such as:
- reducing bottlenecks in infrastructural facilities (like roads, ports, etc.), and in testing centres of international standards
- implementing better quality control
- creating a trade dispute mechanism,
- simplifying procedures and deploying e-governance
During the presentation of the Union Budget in March, Finance Minister Arun Jaitley launched www.ebiz.gov.in. This official Business Portal created by the Modi Government takes on the "Ease of doing business" challenge by integrating 11 different government services and eliminating repetitive and unnecessary procedures. None of all this will change the situation overnight, of course, but we need to acknowledge that many people, here, are making huge efforts to improve things! However, let’s be realistic: these changes take time, and it will be a while before the overall picture really improves. In the meantime, the question remains: can Europeans, for example, nevertheless do good business in India? The answer is a resounding yes: India today truly is a land of opportunity! All one needs is the right kind of information – and especially, the right kind of support! The Arsha Consulting team Reference: Ease of doing business index