The World bank will releases its 2018 edition of the Ease of Doing Business report today. Finance Minister Arun Jaitley will hold a press conference in the evening to underline how India rose to become a business-friendly nation.
Right in the middle of economic slowdown and incessant attacks from the Opposition, the Narendra Modi government expects it will have a cause for some cheer today, when the World bank releases its 2018 edition of the Ease of Doing Business report. So significant is India's rise in becoming a business-friendly nation that Finance Minister Arun Jaitley will himself be holding a press conference in the evening to underline how it was achieved.
Ahead of the crucial Gujarat election in which the state of the economy is a big agenda, any significant improvement in the ease of doing business ranking by the World Bank will be an economic and political plus for the BJP-led government.
Top sources in the government say an improvement is in the offing since the government has initiated multiple reforms in this direction. Almost every policy measure announced in the last couple of years has a built-in improvement in the ease of doing business component. The eventual target is to break into the league of the Top 50 in the world. Currently, India hopes to break into the top 100 nations, or close to 100 from the last ranking of 130.
Traders may be protesting against its implementation, but the sentiment in the corridors in the North and South Blocks on the Raisina Hill in the national capital is positive that the launch of the Goods and Services Tax (GST) has sent out a signal to the world that India is not only rationalising its taxation system, but also attempting to improve the ecosystem for business.
Several elements are taken into account by the World Bank to prepare its ease of doing business list. For example, on paying taxes, India's rank is 172. This particular criterion is likely to drive India's improved standing in ease of doing business. The government has eased corporate tax pressure and reduced paperwork for filing returns after the July 1 launch of the GST.
The GST has subsumed nearly 40 taxes and cesses, which used to require a lot of paperwork and compliance for businesses.
WORLD BANK REPORT ON IMPACT OF GOVT's REFORMS ON INDIA's RANKING IN FUTURE
In its last report, the World Bank had talked about the reforms initiated by the government and the possible impact on India's ranking in future.
The insolvency and bankruptcy law to facilitate a quick end to failed businesses was passed in 2016, its implementation began this year. This is yet another component which will eventually lead to India's improved ranking in future as it took off well before the cutoff.
With demonetisation too, the government expects a big expansion in the tax base. At the recently held World Bank and International Monetary Fund annual meetings in Washington, note ban was talked about as a major reform move to clear the parallel economy.
There has also been an improvement in India's record on protecting minority investors as a result of a slew of measures initiated by the Securities and Exchange Board of India (SEBI). That was why India moved from a 155 rank to 151 last year.
