Wednesday, October 29, 2014

Doing Business Report 2015: A Mixed Bag for India

The World Bank has released its report titled “Doing Business 2015: Going Beyond Efficiency”. It has also published a country report on India for the same year.

At the overall level, India does not emerge in positive light, given that its ranking has fallen to 142 (out of a total of 189 countries) from 140 in last year’s rankings. India does not rank favourably among comparator economies either – Mexico (39), Russian Federation (62), and China (90). The South Asian regional average is above India at 134, with Bangladesh trailing at 173.

This is despite numerous efforts undertaken by the Government both last year (here) as well as this year (here) to improve the environment for business in the country. Since the report is based on data as of June 1, 2014, many of the reforms announced and planned since that date would not have been taken into account for the purpose. It is likely that the more recent reforms would be reflected only in next year’s rankings, which would represent the true test for the country’s performance.

At the same time, all is not bleak, and India performs creditably on an aspect that we pay a lot of attention on this Blog, i.e. investor protection. It ranks at 7 out of the 189 economies. This is perhaps a tribute to the recent reforms in corporate govenance in the form of the Companies Act, 2013 followed by the slew of rules promulgated by the Ministry of Corporate Affairs as well as the revised corporate governance norms prescribed by SEBI.

No comments: