: "Doing business in India is not easy
BS Reporter / New Delhi September 6, 2006


India may have marginally improved its overall ranking in terms of doing business to 134 in 2006 from 138 in 2005, but it still lags behind neighbours like Pakistan, Sri Lanka, Nepal and Bangladesh in terms of ease of doing business, according to the International Finance Corporation.

While the IFC report on 'Doing Business, 2007' released today said that India was the top reformer in South Asia though it still ranks relatively low at 134 and lies 41 places after China-which is reforming at a faster pace than India.

'India, as leading reformer in South Asia, has taken over the top spot from Pakistan in last year's report. India cut the time to start a business from 71 to 25 days and reduced the corporate income tax rate from 36.59 percent to 33.66 percent. A Supreme Court decision made enforcing collateral simpler-easing access to credit. New risk management procedures in customs lowered import time by two days and exports by nine days. And reforms to stock exchange rules toughened investor protections,' the report said.

However, the challenges of starting a business in India are far many with entrepreneurs expected to go through 11 steps over 35 days on an average to launch a business at a cost equal to 73.7 per cent of gross per capita income, it said.

Similarly, it takes 270 steps and 20 days to complete the process of complying with licensing and permit requirements for ongoing operations in India, according to the report. Even among eight south Asian countries, India ranks sixth in the category of 'ease of doing business' with only Bhutan and Afghanistan occupying the position behind it, according to the report.

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