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Indian entrepreneurs can benefit substantially if the government’s efforts to launch ambitious regulatory reforms are sustained over the next several years, the World Bank has said.
“Fostering an environment more supportive of private sector activity will take time. But if the efforts are sustained over the next several years, they could lead to substantial benefits for Indian entrepreneurs — along with potential gains in economic growth and job creation,” the World Bank said in its annual report ‘Doing Business — 2016’
Making a specific mention of India’s economic reform, the Bank said that in 2014, the Indian Government launched an ambitious programme of regulatory reform aimed at making it easier to do business.
Spanning a range of areas, the programme represents a great deal of effort to create a more business—friendly environment, particularly in Delhi and Mumbai, it said.
In May 2015, the government adopted amendments to the Companies Act that eliminated the minimum capital requirement.
Now, Indian entrepreneurs no longer need to deposit Rs 1,00,000 (USD 1,629) — equivalent to 111 per cent of income per capita — in order to start a local limited liability company.
The amendments also ended the requirement to obtain a certificate to commence business operations, saving business founders an unnecessary step and five days.
Several other initiatives to simplify the start—up process were still ongoing on June 1, 2015, the cutoff date for this year’s data collection. These include developing a single application form for new firms and introducing online registration for tax identification numbers, the report said.
Improvements have also been initiated in other areas measured by Doing Business. To make dealing with construction permits easier, for example, a single—window system for processing building permit applications is being started in Mumbai — with the promise of greatly reducing the associated bureaucratic burden once fully implemented.
And online systems for filing and paying taxes are being further improved to simplify tax compliance, the report said.
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