Finance Minister Nirmala Sitharaman recently addressed the Lok Sabha and shed light on the current state of India’s economy. One of the key points she highlighted was the country’s recent drop in the World Bank’s Ease of Doing Business (EODB) rankings. The Finance Minister attributed this decline to the outdated base year of 2011-12 and the data collection methodologies used by the World Bank.
The Ease of Doing Business index is an annual report published by the World Bank that ranks countries based on their business regulatory environment. It takes into account various factors such as starting a business, getting construction permits, getting credit, paying taxes, and enforcing contracts. India’s ranking in this index has been a matter of great concern for the government, as it reflects the country’s attractiveness as an investment destination.
In the latest report, India’s ranking dropped by 10 places, from 63rd to 73rd. This decline has raised eyebrows and sparked debates about the state of the Indian economy. However, Finance Minister Sitharaman has assured the Lok Sabha that the drop in ranking is not a reflection of the country’s economic performance, but rather a result of the World Bank’s data collection methodologies and the outdated base year of 2011-12.
The Finance Minister explained that the World Bank’s data collection methodologies are not in line with the current business environment in India. She stated that the World Bank’s report is based on the feedback of a few selected cities, which may not accurately represent the entire country. This has resulted in a skewed representation of India’s business environment, leading to a drop in the EODB rankings.
Moreover, the base year of 2011-12 is outdated and does not reflect the significant reforms and improvements made by the Indian government in recent years. Since then, the government has implemented various policies and initiatives to improve the ease of doing business in the country. These include the introduction of the Goods and Services Tax (GST), the Insolvency and Bankruptcy Code (IBC), and the digitization of various processes.
The Finance Minister also highlighted that India’s ranking in the EODB index has improved significantly in the past few years. In 2014, India was ranked 142nd, and in just six years, it has climbed up to 63rd place. This is a remarkable achievement and a testament to the government’s efforts to improve the business environment in the country.
The Finance Minister’s statement has been welcomed by various industry experts and business leaders. They believe that the government’s focus on improving the ease of doing business in the country has been instrumental in attracting foreign investments and boosting economic growth. The Finance Minister’s assurance that the drop in ranking is not a reflection of the country’s economic performance has instilled confidence in the business community.
In conclusion, Finance Minister Nirmala Sitharaman’s statement in the Lok Sabha has shed light on the reasons behind India’s drop in the World Bank’s Ease of Doing Business rankings. The outdated base year of 2011-12 and the World Bank’s data collection methodologies have resulted in a skewed representation of India’s business environment. However, the government’s efforts to improve the ease of doing business in the country have been recognized and appreciated globally. With the Finance Minister’s assurance and the government’s continued efforts, India is on track to further improve its ranking in the EODB index and become a more attractive destination for investments.
