India’s overall rank in the ease of doing business rankings may have improved, but still there are severe on-ground issues, the Economic Survey has pointed out. Case in point: Despite focusing on slashing customs procedures to ease the flow of exports, trading across borders remains a major barrier in boosting outbound shipments.
Currently, it takes 60-68 and 88-82 hours in border and documentary compliance for exports and imports, respectively. On the other hand, in Italy — the country with the least customs hold-ups — it takes only one hour for each.
Also, while there is zero cost of compliance in Italy, the survey points out in India, exporters have to shell out $260-281. Delays and procedural inefficiencies further inflate the costs.
The survey mapped the journey of a standard consignment of apparel, a crucial export sector that has recently been battered in recent years by cheaper alternatives from Bangladesh and Vietnam. Exports stood at $16 billion in 2018-19, shrinking 0.7 per cent YoY. Three years after key regulatory and labour changes in the form of fixed-term employment were put in place, apparel shipments to India's largest market, the US, continue to stagnate.