Comparing India with best in clas countries on ease of doing Business

1. Partha Tripathi

2. Ease of doing business is an average indicator based
on 10 parameter such as
Starting a Business
Dealing with construction permits
Getting electricity
Registering Property
Getting credit
Protecting investors
Paying Taxes
Trading across barriers
Enforcing contracts
Resolving Insolvency
Source of These data are world bank report on doing business

3. Doing Business parameters for the year 2012
of India is compared with 5 best in class
countries in various parameters
The Ranking data is compared using Data
Table
Major issues Highlighted
Note: Caution in interpretation should be taken as Ranking High
does not mean that the countries has high GDP growth. There
are other factors such as market size, purchasing power etc
which also influence GDP growth

4. Country Starting a Ease of Doing
Business Business
New Zealand 1 3
Australia 2 15
Canada 3 13
Singapore 4 1
Hong Kong SAR, 5 2
China
India 166 132

5. Parameter Best 5 India
Country
No of Procedure to Start a 1-3 12
Limited Liability Company
No of Days to complete the 1-5 29
procedure
Cost for Incorporation( % on 0.4-1.9% 46.8%
Per Capita Income)
Minimum Paid In capital(% on 0.0% 149.6%
Per Capita Income)

6. Major Issues Areas of Improvement
Higher number of Procedures Number procedure can be
Number of days Taken is high but streamlined instead of getting
can be taken care if the number of various identity numbers such as
procedure is streamlined ESIC, Employees Provident fund etc
can be streamlined. Instead of
Higher Stamp duty
multiple numbers reforms can be
Minimum Paid in Capital Norms oriented toward few numbers
Since the number of procedure are
high it takes more time. Further
now registering a company has
become but registration with
ESIC,EPFO is still not online.
Stamp duty on Company formation
can be reduced.
Minimum Paid in Capital can be
done away with

7. Country Dealing with Ease of Doing
construction Business
Permit
Hong Kong SAR,
China 1 2
New Zealand 2 3
Singapore 3 1
Georgia 4 16
Saudi Arabia 4 12
India 181 132

8. Parameter Best 5 India
Country
No of Procedure to Legally 6-11 34
Build a Warehouse
No of Days to complete the 26-75 227
procedure
Cost for getting all Permits( % 17.8-34.4% 1631.4
on Per Capita Income)
%

9. Major Issues Areas of Improvement
Higher number of Procedures Number procedure can be
Major time taken in Approval of streamlined and made smarter.
building plan, Obtaining NOC from Procedure can be compared with
Tree authority/ Environmental countries Like New Zealand,
clearance & completion Certificate Singapore, Hongkong
where it takes on average about 30 E Governance can be implemented
to 60 days for each procedure across government Departments
No Major Reforms undertaken in which are involved in NOC.
the last 5 years Central Coordinator, with
Electronic documentation storage
and workflow for NOC can be
Thought of.

10. Country Getting Ease of Doing
Electricity Business
Iceland 1 9
Germany 2 19
Taiwan, China 3 25
Hong Kong SAR, 4
China 2
Singapore 5 1
India 98 132

11. Parameter Best 5 India
Country
No of Procedure to Obtain 3-4 7
Electricity Connection
No of Days to complete the 17-43 67
procedure
Cost for Completion of 1.7-52.4% 216.2%
Procedure( % on Per Capita
Income)

12. Major Issues Areas of Improvement
Major time taken in Sanction and Reduction in time for sanctioning
actual connection and giving connection.
No competition in an area. Increasing Competition
Loss making Distribution utilities Bring Efficiency in Distribution
Utilities by linking productivity
with remuneration.
Regulation in service level
agreements

13. Country Registering Ease of Doing
property Business
Saudi Arabia 1 12
Georgia 1 16
New Zealand 3 3
Belarus 4 69
Armenia 5 55
India 97 132

14. Parameter Best 5 India
Country
No of Procedure to legally 1-3 5
transfer title on immovable
property
No of Days to complete the 2-10 44
procedure
Cost for Completion of 0.0-0.3% 7.3%
procedure( % on Per Capita
Income)

15. Major Issues Areas of Improvement
Major time taken in Mutation of Reduction in time for Mutation.
Property. Computerising Land records
No Major reforms in last 5 years

16. Country Getting Credit Ease of Doing
Business
Malaysia 1 18
United Kingdom 1 7
South Africa 1 35
New Zealand 4 3
United States 4 4
Latvia 4 21
Hong Kong SAR,
China 4 2
India 40 132

17. Parameter Best 5 India
Country
Strength of Legal Rights 10-9 8
Index(0-10)
Depth of Credit Information 6-5 4
Index(0-6)
Public Credit registry 59.7-0.0% 0.0%
Coverage(% of Adults)
Private Credit Bureau 100.0-0.0% 15.1%
Coverage(% of Adults)

18. Major Issues Areas of Improvement
No Major issues

19. Country Protecting Ease of Doing
Investor Business
New Zealand 1 3
Singapore 2 1
Hong Kong SAR,
China 3 2
Malaysia 4 18
United States 5 4
Canada 5 13
Ireland 5 10
Colombia 5 42
Israel 5 34
India 46 132

20. Parameter Best 5 India
Country
Extent of disclosure index(0- 10-7 7
10)
Extent of Director Liability 9-5 4
Index(0-10)
Ease of shareholders suit 10-6 7
Index(0-10)
Strength of Investor protection 9.7-6.0 6.0
index(0-10)

21. Major Issues Areas of Improvement
Lack of Directors Liability in areas Improving in the areas of Directors
such as Paying back profits and Liability such as repaying profit
damages to shareholders in case earned and paying damages in
of willful Fraud case of fraud committed by
Directors.

22. Country Paying Taxes Ease of Doing
Business
Maldives 1 79
Qatar 2 36
Hong Kong SAR, 3
China 2
Singapore 4 1
Ireland 5 10
India 147 132

23. Parameter Best 5 India
Country
Tax payments ( No per year) 3-8 33
Time required to comply with 0-84 254
3 major taxes (hours/year)
Total tax rate(% on Profit 9.3-27.1% 61.8%
before tax)

24. Major Issues Areas of Improvement
More number of taxes Streamlining no of taxes to be paid
Electronic filing is present in all Electronic filing for taxes which
type Statutory payments are not yet done such as ESIC,
EPFO

25. Country Trading Across Ease of Doing
border Business
Singapore 1 3
Hong Kong SAR,
China 2 1
Estonia 3 89
Korea, Rep. 4 26
United Arab Emirates 5 12
India 109 132

26. Parameter Best 5 Country India
Documents required to Export 3-4 8
(Numbers)
Time required to Export (Days) 5-7 16
Cost Required to 456-725 1095
Export(USD/40’ Container)
Documents required to Imports 3-5 9
(Numbers)
Time required to Import(Days) 4-7 20
Cost Required to Import 439-725 1070
(USD/40’ Container)

27. Major Issues Areas of Improvement
More number of Documents Streamlining no of Documents for
Time taken for processing Export as well as imports
Cost of Processing Benchmarking with Best in class to
Documents preparation times understand the issues
Reduction in cost of processing

28. Country Enforcing Ease of Doing
Contract Business
Japan 1 63
Singapore 2 3
Canada 3 25
Norway 4 60
Finland 5 45
India 182 132

29. Parameter Best 5 India
Country
Time( Days) 150-570 1420
Cost(% of Claim) 9.9-32.2% 39.6%
Procedures( numbers) 21-36 46

30. Major Issues Areas of Improvement
Time taken to complete Trials Judicial procedures so that Trails
are concluded quickly
Filling up vacancies

31. Country Resolving Ease of Doing
Insolvency Business
New Zealand 1 3
Singapore 2 1
Hong Kong SAR,
China 3 2
Malaysia 4 18
United States 5 4
India 128 132

32. Parameter Best 5 India
Country
Time in Years 0.8-1.5 7
Cost to recover Debt (% of 1-15 9
Estate)
Recovery Rate for Creditors 44.6-91.3% 20.1%
(Cents on the Dollar)

33. Major Issues Areas of Improvement
Time taken are very High to Bench marking with Singapore,
resolve Insolvency New Zealand, Hongkong
Recovery rate for creditors are low Time bound disposal of cases