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Soon, states to be ranked on ease of doing business

business Updated: Feb 18, 2015 22:56 IST
prime minister's office

In a first-of-its-kind initiative, the Centre is set to give ratings to states on the basis of ease of doing business parameters, and come out with a ready reckoner that will help the industry in decision-making.

The move, part of the agenda of the prime minister's office (PMO) to improve India's ease of doing business ranking on the World Bank index, aims at improving business sentiment and increasing competitiveness among states.

A senior government official said Centre would release the ratings in July, and will be based on 10 parameters for reducing time taken from the inception of a business to its exit.

"This was also decided in the December 29 Make in India workshop. States and their chief secretaries informed Prime Minister Narendra Modi they had begun work to help grow investments," the official said.

He said, "The 10 parameters include: starting a business (including getting power and water connections), environment clearances, land and building clearances and permits, labour laws and clearances, inspection of the businesses, exit mechanism and resolving insolvency, credit and financing facilities."

Cabinet secretary Ajit Kumar Seth was named the nodal officer to monitor the performance of the Centre and the states. After this, the department of industrial policy and promotion (DIPP) secretary wrote to all the states to initiate steps on these parameters.

Last week Seth met senior officials of different departments including commerce, DIPP and finance to take a stock of the performance till now.

"The states will have to submit a detailed report by May. The Centre will officially come out with the ratings by July," the official told HT.

States that have started performing and top the informal list include Delhi and Maharashtra. There is a stress on these two states as they are tracked by the World Bank in its assessment of India for the Ease of Doing Business survey, the official said.

The Centre will make an official announcement on this process shortly, preparing the ground for releasing its ratings.

The government has set an ambitious goal of bringing India into the top 50 on the World Bank Ease of Doing Business index, from its current rank of 142 on a list of 189 countries, within two years.