The Financial Express

India tops South Asia reforms barometer

February 14, 2007

New Delhi: India is now the leading reformer in South Asia, having replaced Pakistan—last year’s topper—in the list of eight nations. That is the verdict of the World Bank’s ‘Doing Business in South Asia’ report, which compares business regulations across countries in the region.

Significantly, the Bank places India among the top 20 reformers worldwide, and identifies key reforms taken up by India over the last year that have reduced the time, cost and hassles faced by businesses in complying with legal and administrative requirements.

The report ranks countries on the basis of a range of ‘Doing Business’ indicators that include dealing with licences, employing workers, registering property, getting credit, paying taxes and trading across borders. Most significant of the outcomes was the drastic reduction in the time taken to start a business—from 71 days to 35 days—and the reduction in corporate income-tax from 36.59% to 33.66%. The reform efforts were also bolstered by the Supreme Court verdict that made enforcing collateral much simpler, thus helping to ease access to credit. Other notable reforms cited in the report include new risk management procedures in customs that have helped reduce import time by two days and export time by nine days. The major capital market reform cited by the report was the new stock exchange rules, which strengthened investor protection.

Taking a more positive view of the Indian scenario, the World Bank says the potential for further improvement is substantial as good practices do exist in India and all that it has to do is replicate them on a larger scale.

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