The World Bank is likely to wrap up its ranking of Indian states by the end of August on reforms undertaken by them on the ease of doing business. “States have submitted about 7,000 items of information regarding the reforms they have undertaken on the ease of doing business. The World Bank team has already reviewed and approved some 3,000 items. We expect the whole process to be over by the end of this month. Till then, the rankings displayed on the portal are only temporary,” Ramesh Abhishek, department of industrial policy and promotion (DIPP) secretary, told FE.
According to the real-time ranking of states displayed on a website run by DIPP, Jharkhand, Madhya Pradesh and Andhra Pradesh led the pack of states (as of 6.30 pm on Wednesday) in implementing reforms on the 340 issues flagged jointly by the states and DIPP. Though states were asked to submit relevant documents by July 7 on reforms undertaken by them until June 30, the window for the resubmission of clarifications would be open until August 16. Gujarat, which had occupied the top slot in last year’s ranking, is placed at number 7, up from the 12th spot around a month ago. Last year, NDA-ruled states occupied the top six slots.
The Centre has asked the World Bank to rank states on the ease of doing business for the next three years to ensure non-partisan nature of such an exercise. Last year, when states were ranked for the first time on ease of doing business, DIPP, industry chambers CII and FICCI, and consultancy firm KPMG — apart from the World Bank — were involved in the rigorous exercise.
The rankings are an assessment of the regulatory performance of states and a measure of how they improve over a period of time.
Importantly, the rankings don’t accurately reflect the level of business-conducive nature of the states; rather, it shows how the states fared in implementing an action plan adopted by them with the help of the Centre within a particular time frame. The ranking is based on indicators, including the ease of starting a business, registering a property, getting credit, paying taxes and resolving insolvency.
Abhishek said India is also hopeful of improving its rank among other nations in the World Bank’s Ease of Doing Business Index. Last year, India was ranked 130th in the World Bank’s index covering 189 countries, an improvement of four notches from a year before. While India improved its rank on three counts — starting a business, getting construction permits and accessing electricity, it witnessed its performance worsen in two areas — accessing credit and paying taxes.
“We certainly hope to better our ranking this year. There is a lot of progress on ground. The World Bank team had come and they have sought some more information (on the reforms undertaken) from us. We are in the process of providing those to them,” Abhishek said. The reforms by the states are expected to brighten India’s chances of a better rank this time around.