Avoid complacency

With reference to the editorial, “Thumbs up from the World Bank” (November 1), India’s jump in ranking on ease of doing business is significant for several reasons. India was at the 130th spot last year and had hovered in the same vicinity for the last decade. China, the biggest economy in the region, remains at the same spot as last year. 

Factors such as enactment of the Insolvency and Bankruptcy Code in 2016 and tax reforms pushed up India’s rank substantially. The credit should be shared by stakeholders, state governments, officials and the administrative staff at key ministries. Bureaucracy is the most critical cog in the wheel; once it is on the same page as the Narendra Modi government’s reform agenda, India can hope to break into the top 50 in a few years from now.

A jump of 53 spots in terms of the tax paid is the biggest factor in India’s overall improvement in ranking. The next factor to watch out for is sovereign credit rating: An improvement here would help reduce cost of external borrowing. 

One parameter that deserves the attention of the government and other stakeholders is enforcement of contracts. A good performance here would minimise disputes between private companies and government agencies; lenders would also not suffer. 

The introduction of the goods and services tax (GST) and the glitches in its implementation have not been factored into the World Bank rankings this year. The government should be proactive and take measures so that the recent problems with GST do not dent India’s rank next year. Instead of being overjoyed with the current rank, the government should focus on gross domestic product growth, job creation and attracting private investment.

Bal Govind, Noida

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