Andhra Pradesh leads India in ease of doing business

BI Bureau

New Delhi

Chief Minister YS Jagan Mohan Reddy has proved his mettle again, while Chief Minister Yogi Adityanath proved a dark horse, as Andhra Pradesh and Uttar Pradesh bagged the first the second position respectively in ease of doing business. Union Finance Minister Nirmala Sitharaman on September 5 announced the 4th edition of Business Reform Action Plan (BRAP) ranking of states.

The announcements were made in the presence of Piyush Goyal, Minister of Railways and Minister of Commerce & Industry, Hardeep Singh Puri, Minister for Commerce and Industry and Minister of State (Independent Charge) of the Ministry of Housing and Urban Affairs; Minister of State (Independent Charge) of the Ministry of Civil Aviation, Som Parkash, Minister of State in the Ministry of Commerce and Industry. Chief Ministers of Uttarakhand and Tripura, LGs of J&k and Ladakh, Industry Ministers of States and Union Territories, along with senior government officials were also present.

Ranking of states are based on the implementation of the Business Reform Action Plan started in 2015. Till date, State Rankings have been released for the years 2015, 2016 and 2017-18.The Business Reform Action Plan 2018-19 includes 180 reform points covering 12 business regulatory areas such as Access to Information, Single Window System, Labour, Environment, and so on.  The larger objective of attracting investments and increasing Ease of Doing Business in each State was sought to be achieved by introducing an element of healthy competition through a system of ranking states based on their performance in the implementation of Business Reform Action Plan.

The ranking this time gives full weightage to the feedback from over thirty thousand respondents at the ground level, who gave their opinion about the effectiveness of the reforms. The State rankings will help attract investments, foster healthy competition and increase Ease of Doing Business in each State.

“India is seen taking the reform process seriously which showed when foreign direct investment in the country increased even during the Covid-19 pandemic, amid what was called the world's strictest lockdown. Some states have shown extraordinary energy in putting together action plans and making sure that reforms happen. States have embraced the true spirit behind the State Business Reforms Action Plan,” said Sitharaman after the release of the rankings.

“The Ease of Doing Business rankings being released today are a reflection of the efforts made by states, the rankings are competitive; India is among the very few nations which has state-specific rankings, which will in turn help the nation improve its ranking,” PiyushGoyal said during the event.

“I would urge States to undertake steps to minimize the regulatory burden by removing renewal of licenses or extending their periodicity, simplifying application forms, introducing risk-based inspections or introduction of third-party inspections, digitizing approvals and undertaking measures to rationalize the regulatory regime,” said Hardeep Singh Puri.

The top ten states under State Reform Action Plan 2019 are Andhra Pradesh, Uttar Pradesh, Telangana, Madhya Pradesh, Jharkhand, Chhattisgarh, Himachal Pradesh, Rajasthan, West Bengal, and Gujarat. The exercise is aimed at promoting competition among states with a view to improving the business climate to attract domestic as well as foreign investments. Registering a jump of 10 places in the rankings, Uttar Pradesh occupied the second position in 2019 as against 12th in 2018.

Telangana slipped to the third position from second in 2018. It was followed by Madhya Pradesh (4th), Jharkhand (5th), Chhattisgarh (6th), Himachal Pradesh (7th), Rajasthan (8th), West Bengal (9th) and Gujarat (10th). Delhi's position improved to 12th from 23rd in the last edition, while Gujarat slipped from 5th place in 2018. Among the laggard states and UTs in the ranking, Assam was at 20th, J&K at 21st, Goa at 24th, Bihar at 26th and Kerala 28th place. Tripura was ranked at the bottom 36th.

In 2015 Index, Gujarat featured at the top, with Andhra Pradesh grabbing the second position and Telangana 13th. In 2016, Andhra Pradesh and Telangana jointly topped the chart. In the last ranking released in July 2018, Andhra Pradesh topped the chart, followed by Telangana and Haryana (3rd). Haryana slid to 16th position in the latest ranking. The DPIIT in collaboration with the World Bank conducts an annual reform exercise for all States/UTs under the Business Reform Action Plan (BRAP).

 The larger objective of attracting investments and increasing ease of doing business in each state was sought to be achieved by introducing an element of healthy competition through a system of ranking states based on their performance in the implementation of Business Reform Action Plan, according to the report.  Secretary in the Department for Promotion of Industry and Internal Trade (DPIIT) Guruprasad Mohapatra said that the ranking this time gives full weightage to the feedback from more than 30,000 respondents at the ground level, who gave their opinion about the effectiveness of the reforms. State rankings will help attract investments, foster healthy competition and improve business climate.