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India ranked 116 in business ease
By agencies
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Wednesday, 14 September 2005, 19:30 IST
NEW DELHI: Despite being the second fastest growing economy in the world, India throws quite a challenge to do business.
In a survey released yesterday, the International finance Corporation (IFC) the private sector arm of the World Bank has ranked India 116 out of the 155 countries surveyed when it comes to the ease of doing business.
In the survey titled Doing Business 2006, IFC has ranked Indias neighbors like Pakistan, Bangladesh, Sri Lanka and China above India at 60, 65, 75 and 91 respectively.
The survey said the though the time taken to start a new business has come down to 71 days from the earlier 89 days, foreign business houses need to complete 11 formalities before setting up formal business operations in India.
It also said it takes about 270 days to obtain a license in India but 10 years to close a business, which is nearly the double then the regional average of 5.1 years.
The report however has praised India for the legal rights getting 5 on a scale of 10 while the regional average is 3.8. Unlike last years index, India is not included among the top reformers in this years report. The report has also praised India for setting up a credit information bureau and putting in place a new system for enforcing collateral, which, according to the survey, has resulted in the enforcement timing falling from 10 years to six months.
The reduction of stamp duty from 10 percent to 5 percent for property registration in India has also been cited as a way forward for other countries as revenues have increased due to better compliance.