New Delhi: The Department of Industrial Policy and Promotion on June 9 released a framework to assess and rank states in terms of ease of doing business, a move aimed at triggering competition among states to attract investment.
The key objectives of the assessment are to examine the implementation of various factors enabling ease of doing business in a state; and to do a comparative study of various states with regards to the implementation status.
The states will be ranked on the basis of various parameters which include setting up a business such as allotment of land and obtaining construction permit; complying with environment procedures; complying with labour regulations and obtaining infrastructure related utilities.
DIPP shall also obtain inputs through a separate questionnaire from industry with regards to factors enabling ease of doing business in the state. "The ease or difficulty of doing business in a state is a function of the structures/ framework put in place by the state along with the implementation of the structure.
"Institutionalisation of reforms through the structures will ensure manifestation of outcomes. In order to enhance the ease of doing business in various states in India, the Department of Industrial Policy and Promotion (DIPP), has initiated a study to assess states on reform parameters that are germane to ease of doing business," the DIPP said.
The Assessment Framework has been prepared as part of an annual exercise undertaken by DIPP to assess states on enabling Ease of Doing Business. India is ranked 142 among 189 nations in the World Bank's Ease of Doing Business 2015 study.
With the exception of two parameters (Getting credit and Protecting minority investors), India does not feature in the top 100 in the remaining parameters. "India's overall ranking and the individual rankings in various parameters clearly show that India is in urgent need of reforms to unlock the huge economic potential of the nation.
However, the reforms need to be initiated at various levels across Centre, State and local governments. "A coming together of bold and necessary reforms in various areas will herald an era of high value investments, infrastructure growth, job creation, skill development and economic prosperity," DIPP said.
DIPP has also circulated a document with recommendations for states on aspects critical to enabling ease of doing business. The document highlighted good practices in various areas that need to be institutionalised for states to improve their investment eco-system. A study is now being carried out to assess the implementation of the recommendations by the states, it said.
