Ease of doing business not crime

India has jumped astonishing 65 spots on ease of doing business Index in last 4 years. Most people who also claim to be victims of regulatory probes are expressing disbelief. I also have a disbelief but the other way round. I believe that the rank should have been even better. Ease of doing business Index is published by World Bank and inter alia takes into account starting a business, construction permits, electricity, property registration, credit, paying taxes, cross-border trade, enforcing contracts and resolving insolvency. Without expressing favour to any political party, I believe that doing business in India is as easy now as any other developed country while committing white collar crimes is getting difficult. Why ? see below

a) I incorporated a company earlier this year and after 4-5 years and my experience was completely different. While MCA was exceptionally tough in accepting my documents particularly those relating to establishing the identity of people and places. They rejected my documents twice. Had I been like other educated illiterate, I could have cried foul, but I understand it is to prevent creation of 'Shell Companies' or companies owned by non-existent people, which are major problem in our country and linked to larger global problem of tainted money laundering. Once the documents were complete, the COI came within 24 hours and to my utter shock and pleasant surprise it also had PAN and TAN in it. Now, these are functions of two different large bureaucratic machineries belonging to different Ministries and in 25 years of my business experience in this country I had never imagined to see the day they worked in tandem and so fast. With GST in place which is the only other statutory registration required and which can be done with same set of documents , it is actually possible to be in business in India in one week with an incorporated form of entity and without any need to visit any Government office. This is at par with most developed countries if not better.

c) Income tax department is moving almost completely to e-proceedings and GST and MCA are also completely online. Yes product approval for certain categories like packaged food, drugs ( which is so in developed countries also ) etc require visit to Government offices but on an ongoing basis there is absolutely no need for a Business to visit a Government office. Paying taxes and dealing with Government is easier than all times now.

d) Poor enforce-ability of contracts is mostly due to the over-litigating society and slow judicial process. This is a side effect of maintaining high level of democratic liberties in a country which has so much of diversity and inequality and will go with time only. However, Government has taken a number of steps like doing away with Notarisation, setting up courts, amendment in cheque bouncing law etc etc to improve this.

e) The brand new Insolvency Law and process is at par with the best in the world and being part of some, I know its working like a well oiled machinery. Anyone without any fraudulent intent cannot complain about the process of shutting down a business. In fact, overseas players can actually now land into the country a day before they start trading and leave the day after they shut it without any need to come here for any other business.

f) On top of everything, doing business can never be easy with high level of corruption. Even if the compliance need is minimised, corruption can make it very difficult. Again without rating the performance or conduct of the Government, it is very clear that at the intent and policy level there seems to be very high level of urgency to reduce corruption as is evident from reduction of physical interface, crackdown on benami properties and cash.

Having done business for 25 years in this country, I know Indians are used to a particular way of doing business which depends on 3Cs ( corruption , cash and chaos ) and from this point of view doing business is getting difficult. We are used to 'Maximum law Minimum Enforcement'. We believe compliance is harassment. We believe tax is an expense and not a social liability. However, I have also seen the right way of doing business elsewhere in the world and therefore would say 'doing business is getting easier but not crime'.