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Ease of Doing Business ranking: Placed among laggards, miffed Kerala demands to know basis of exercise

Our Bureau Thiruvananthapuram | Updated on September 08, 2020

Kerala says it has completed 85 per cent of 187 missions under the reform action plan   -  Getty Images/iStockphoto

Kerala was put at the 28th place along with laggard States

Kerala State Industrial Development Corporation (KSIDC), the state nodal agency for industrial promotion, has approached the Centre seeking details of the criteria applied for deciding the Ease of Doing Business ranking 2019, after Kerala was put at the 28th place along with laggard States.

Kerala found itself grouped along with the States and Union Territories of Assam (rank 20); Jammu & Kashmir (21); Goa (24); and Bihar at 26th. Tripura came in lowest at 36. The KSIDC pointed out that the ranking lacked clarity on some counts and urged the Centre to disclose details of the criteria applied.

The ranking, as published on the website of the Department for Promotion of Industry and Internal Trade on September 5, did not reveal either the criteria adopted for scoring and ranking or disclose the feedback from the States and the Union Territories, said S Harikishore, Managing Director, KSIDC.

85 per cent of missions accomplished

As per the Business Reform Action Plan of 2019, each State had to complete 187 missions. Of these, Kerala has accomplished 157 missions, which makes up for 85 per cent of the mandated missions. Details in this regard are, however, not available on the website that put out the ranking, Harikishore said.

It was stated that the ranking would be decided based on the Reform Action points and feedback scores obtained from states and UTs concerned, but here again the details are not available. Details on yardsticks adopted for the scoring and ranking too have not been shared, which has contributed to a lack of clarity with respect to the process of ranking.

The Union Territory of Lakshadweep, which has not carried out any reforms as cited on the website, has been ranked 15th. Several criteria announced for ranking have been changed in the current ranking. For instance, the North-eastern States and Union Territories have been bracketed together in the current ranking, Harikishore said.

Systematic progress made

Over the past four years, Kerala has made steady and systematic progress in formulating and implementing reforms suggested. The record of Kerala in securing the goals set by the Centre in this regard has steadily increased to 22.8 per cent in 2015-16; 26.9 per cent in 2016-17; 52.56 per cent in 2017-18; and 85 per cent in 2018-19.

The State government has also drawn up and proactively implemented a slew of innovative measures during this period to make the state industry-friendly. These include announcement of an investor-friendly industrial policy that has created what Harikishore described as the most conducive ecosystem for industrialists and service providers.

As many as seven Acts have been amended to bring in the comprehensive Kerala Investment Promotion and Facilitation Act-2018, which has made the investment process fast and transparent. The enactment of the Kerala Micro Small Medium Enterprises Facilitation Act-2019 has considerably eased the investment procedures, including pollution control clearances.

Single Window Clearance Board

The Kerala State Single Window Clearance Board and Industrial Township Area Development Act was a decisive step to fast-track the investment process across the sectors. Over 100 projects were showcased at the ASCEND Kerala meet 2020 held in Kochi in January, where major investment decisions were clinched with entrepreneurs from India and abroad.

During this period, the state also launched the Invest Kerala portal and Kerala Single Window Interface for Fast and Transparent Clearance (K-Swift). Since the local bodies play an important role in facilitating industries, a series of brain-storming sessions were held to engage elected representatives and officials as active partners in evolving a transparent and enabling ecosystem.

Considerable progress has been made in digital connectivity, skill development and infrastructure development. At least 52,137 MSME enterprises started since 2016, making for 40 per cent of all businesses in this job-generating sector. The state has clocked investment of ₹4,500 crore in this sector alone, which vouched for the strides made by it in industrialisation.

Published on September 08, 2020

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