UPA lets ministries vie for studies on improving 'Doing Business in India'
Initiating and flaunting studies on improving business environment is becoming the latest fad in the Indian Government. Different entities in the UPA Government just want to be perceived as making easier 'doing business in India' as their business. Don't expect them to act on countless ideas and suggestions made by numerous official committees on macro, micro and sector-specific reforms. After all, that is not their business.
The latest race to improve business environment started with the Ministry of Corporate Affairs (MCA) releasing the report of the Committee for Reforming the Regulatory
Environment for Doing Business in India (DBI) in September 2013. The Committee chaired by ex-Sebi chairman, M. Damodaran, has made suggestions whose sincere implementation can help the country remain in double-digit growth mode in perpetuity.
A
few days after the release of Damodaran committee report, Planning Commission also
made public a similar report titled ‘Towards an Optimal Business Regulatory
Framework in India’. This has been prepared by Implementation Group for 12th
five year plan in association with Booz & Company.
This
report has approached the subject in different manner while making valuable
recommendations on different issues, some of which such as labour reforms are political
untouchable.
As
put by the report, “The hallmark of any analysis is the degree to which the recommendations
are actually implemented.”
One
does not know whether Department of Industrial Policy and Promotion (DIPP) mandarins
or its boss, Minister for Commerce and Industry Anand Sharma, spared some time
to read these two reports before deciding to commission their own study.
What
we know is that DIPP is currently scouting for a consultancy firm via the tendering route for launching a Study on “Improving the Business Environment in India”.
Explaining
the rationale for the proposed study, DIPP says: “It is estimated that about 650
million people in the country constituting around 61 percent of the population
are in the working age group of 15-59 years. It is estimated that an additional
about 200 million Indians will enter the job market in next 15 years. Inclusive
growth is possible only if all workers have access to opportunities for
employment and entrepreneurship. If India has to grow at 9 to 10% per annum,
manufacturing has to grow at 13 to 14% per annum through an enabling policy
framework and reduced logistic costs.”
It
adds: “Unlocking the job potential and growth of the economy calls for
accelerating the pace of investments. At a time when there is an intense
competition among counties to attract investments and produce goods and
services at competitive costs, the quality of business environment plays a
critical role in determining the level as well as pace of investment in the
country. As India is ranked poorly in the ease of doing business, it is
imperative to identify issues which impact the business environment in the country
adversely and suggest policy actions accordingly.”
Indian
Establishment should take a leaf out of Asia-Pacific Economic Cooperation
(APEC) to coordinate its disjointed and over-lapping efforts at improving business
environment in India.
As
put by a recent document by APEC, “Improving the region’s business regulatory
environment is
a focus of APEC, and member economies have pledged to carry out regulatory reforms
both collectively and unilaterally.”
It
says: “Using 5 Doing Business indicator
sets, the action plan targets an APEC-wide aspirational goal of making it 25%
cheaper, faster and easier to do business by 2015, with an interim target of 5%
improvement by 2011.”
In
the run to Lok Sabha polls, can the Prime Minister Dr. Manmohan Singh, salvage
his reforms image by making business governance more transparent, rule-based
and credible?
Would
N. Modi-led new Government set APEC-type goals and timelines,
assuming its formation has brightest prospects in the existing political flux
and governance mess?
