India Ranked As Appalling Business Hub

By agencies   |   Friday, 08 September 2006, 19:30 IST
Printer Print Email Email
NEW DELHI: A report prepared by the World Bank and the International Finance Corporation IFC reveals that doing business in India is a difficult proposition. India ranked 134 among 175 countries on various parameters of business environment, according to the report. The rankings track indicators of time and cost needed to meet government requirements in business start-up, operation, trade, taxation, and closure. They do not track variables like market size, macroeconomic policy, quality of infrastructure, currency volatility and investor perceptions. The report- Doing Business 2007: How to Reform - says that despite the reforms that India undertook in 2005-06, a number of obstacles, like slow courts and rigid labour laws, remain. Even among eight south Asian countries, India ranks sixth in the category of ‘ease of doing business’ - ahead only of Bhutan and Afghanistan. “This year the report has added an additional 20 economies to the survey. If we were to adjust last year’s ranking for India, it would be 138 and not 116. So India's ranking has shown an improvement from 138 to 134 this year,” said Melissa Johns, investment policy specialist of this special report. The government, however, rubbished the report. Minister of State for Commerce, Jairam Ramesh, told a leading newspaper in the country, “All such rankings are bogus, whether it’s done by the World Economic Forum, Transparency International or the World Bank. What matters is the economic performance. We are doing well on that front as is reflected by the growing interest of international investors.” GE Money, a foreign-owned non-banking financial company agreed that they never felt that there was any problem in doing business in the region. “We have been India for last 12 years. The business is booming. "We have had over 50 per cent growth and we do not see any impediments, which would slow down business,” said Vishal Pandit, President and CEO- India, GE Money. Arun Maira, Chairman, Boston Consulting Group, India, said, “I would like to see a report from IFC-World Bank that takes into account three critical parameters: the speed at which the foreign companies have earned profits, how big is the volume of profit and how easy or difficult it is to repatriate profits from the country. I am sure the results and ranking would be different.” Agreed Siddharth Pai, Managing Director, Technology Partners International. “Most of the factors that would be important to any investor seem to have been excluded from the report. Our experience is that India is on top of the mind of major business establishments abroad,” he said.

siliconindia