Singapore occupies the top position in the world with the most business friendly regulations. It is followed by New Zealand, Hong Kong, Denmark, Korea, Norway, USA, UK, Finland and Australia. According to the World Bank’s Doing Business 2015 study, India is ranked at a lowly 142 among 189 nations in the ease of doing business ranking.
The report points out that economies performing best in the Doing Business rankings are not those with no regulation but those whose governments have managed to create rules that facilitate interactions in the marketplace without needlessly hindering the development of the private sector.
The World Bank has been ranking economies on the ease of doing business since 2005. The parameters used for arriving at the ranking include procedures, time and cost required to start a business, requirements of warehouse, electricity, transfer of property, tax regulations, shareholders’ rights, import and export documentations and the like.
The study also brings out the reforms made by different countries during 2013/14 towards business regulation. It states that India made starting a business easier by considerably reducing the registration fees, though it also added a requirement to file a declaration before commencing business operations. India also made obtaining a new electricity connection in Mumbai less costly by reducing the security deposit. Further, it strengthened minority investor protection by requiring greater disclosure by board members and introducing additional safeguards for shareholders of privately held companies.
The Government of India aims to improve the country’s ranking to 50 in the next couple of years. Only time would tell how successful it would be.