The World Bank has recently published the Ease of Doing Business Rankings for 2019-20, whereunder, India has bagged the 63rd position based on the following criteria. Amongst the other rank holders, New Zealand has been ranked at the 1st position, and Singapore at the 2nd:
1- Commencement of business- The process of incorporation of a company in India has been simplified to a larger extent with the introduction of filing of electronic forms and applications, obtaining digital signature certificate, name reservation, abolishing of filing fees in Mumbai and Delhi in certain cases, approval or rejection of incorporation within 1 business day, issue of Permanent Account Number (PAN), Tax Deduction and Collection Account Number (TAN), and Director Identification Number (DIN) at the time of incorporation itself, elimination of requirement of company seal, etc.
2- Infrastructure and construction permits- The timeline and process of obtaining construction and building permits, certification for building quality control, etc have been made faster and lesser expensive.
3- Cross-border trading- The process of trading across borders has been simplified with the introduction of e-filing of documents, upgradation of port infrastructure, etc.
4- Insolvency regime- The Insolvency and Bankruptcy Laws of India have been more focused on the speedy reorganization of a company, individual, proprietorship, etc that is unable to clear its dues, as opposed to liquidation of such entities. This has increased the rate of recovery of debts in India. Prior to the said law, it was difficult for secured creditors to recover debts through long pending litigations that lasted for more than 5 years.
The aforesaid efforts of the Government have enabled India to gain a higher spot in the International Rankings. But according to various experts, India has to still make continuous efforts to achieve improved rankings in the individual sectors of registration of property, enforcement of cross-border contracts, payment of taxes, and customs clearance, ground handling and loading-unloading procedures at ports in cases of exports and imports, etc.
Recently, the Union Minister for Finance and Corporate Affairs, Mrs. Nirmala Sitharaman, has also stated that India has indeed marked its presence at the global level by improving its ranking in Ease of Doing Business from 142 in 2014 to 63 in 2019, but there are still certain hurdles that are faced in routine businesses that have to be addressed by the Government in the coming times.
Senior Legal Associate
The Indian Lawyer