Lessons to learn from each state: India's staircase to global rankings

Each state’s best practices and ideas would be used to lift India’s ranking on the global ease of doing business index. The states voiced their opinions and suggestions on taking forward reforms at a meeting chaired by Cabinet Secretary PK Sinha on Friday.

Based on discussions with the states, the Department of Industrial Policy and Promotion has drawn up a list of best practices for all states to emulate. The list includes reforms that some states have implemented better than the others after the DIPP had given them six months in December 2014 to bring about ease of doing business based on 98 parameters. "States can benefit from each other's accomplishments... Each of them has done well on different parameters," a senior government official told ET.

Some practices that states have been asked to adopt include Madhya Pradesh's work on easing construction permits, inspection reforms by Gujarat, Maharashtra and Delhi and the single-window clearance system in Punjab.

Gujarat topped the domestic ease-of-doing-business rankings with a score of 71.14%. The assessment of states shows that on average, only 32% of the proposed reforms have been implemented in India.

Punjab scored the highest with 81.4% for setting up a business by starting an online single-window system for registrations and licenses that cover most of the regulatory services in the country. Gujarat had a 100% score for complying with environment procedures, while Jharkhand got 100% for complying with labour regulations.

"This change will come gradually and each year we have to up the benchmark. States should take more steps to build more infrastructures and improve connectivity," said Jaijit Bhattacharya, partner, infrastructure and government services at KPMG India. For next year's rankings, DIPP has prepared a set of 334 questions to the states, up from 285 this year to collect data on the steps implemented.

To boost the competitive spirit, the government will also launch an online dashboard to track real-time rankings of states on the basis of number of reforms undertaken by them. Industry representatives will be able to provide live feedback on this portal, keeping in check any false claims made by states. India has emerged among the top three investment destinations, according to 60% of the respondents in a recent EY survey. The report also said investors are still cautious about the business environment.

India was placed 142nd out of 189 countries in the World Bank's Doing Business rankings for the period to June 2014.

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