Andhra Pradesh, Gujarat among ‘top achievers’ in ease of doing business

Andhra Pradesh, Gujarat and Haryana are among the seven states that have been classified as “top achievers” in rolling out the Business Reforms Action Plan (BRAP) for 2020, set by the department for the promotion of industry and internal trade (DPIIT).

The BRAP report, released by finance minister Nirmala Sitharaman on Thursday, also categorised Karnataka, Punjab, Tamil Nadu and Telangana as “top achievers”.

Importantly, in a break from the past, states are not ranked in any particular order this time but are clubbed into four categories–top achievers, achievers, aspirers and emerging business eco-systems. So, comparisons with past performances of any particular state aren’t feasible.

The states and Union territories (UTs) that have scored over 90% in implementing the reforms agenda comprising 301 initiatives covering 15 areas–including access to information, single window system, labour and land administration – are referred to as “top achievers”. Similarly, those that have scored between 80% and 90% are categorised as “achievers” and those with a score of 60% to 80% are “aspirers”. States and UTs with scores below this level are in the category of emerging business eco-systems.

Explaining the reason behind the change in the ranking system, DPIIT secretary Anurag Jain said the scores are so close that it’s only fair that the states and UTs are clubbed into different categories instead of being ranked in any particular order.

Himachal Pradesh, Madhya Pradesh, Maharashtra, Odisha, Uttarakhand and Uttar Pradesh emerged as “achievers”. The “aspirers” category includes Assam, Chhattisgarh, Goa, Jharkhand, Kerala, Rajasthan and West Bengal. In the category of “emerging business ecosystems”, there are 11 states and UTs, including Delhi, Puducherry and Tripura.

For the BRAP 2022, the DPIIT has included a total of 352 action points for states and UTs to implement, after due consultations with them. Of these, 261 action points are for business reforms and 61 are citizen-centric. So, for the first time, it will also add elements of “ease of living” to the whole exercise, apart from those of “ease of doing business”.

The broader aim of this exercise is to boost investor confidence, foster a business-friendly climate and augment the ease of doing business across the country by introducing an element of healthy competition, according to the DPIIT.

The categorisation of states and UTs is based purely on stakeholders’ comments on all reform measures, instead of a mix of their claims (verified) and user feedback.

Speaking on the occasion, Sitharaman said the nature of reforms has changed over the years. “Unlike the reforms of 1991, which were given to us for implementation, there is no compulsion now. The objective is to see what will bring out improvement in systems and ensure better lives for us. An element of nudge has been brought into every layer of the government,” she said. For instance, the finance ministry, while increasing the borrowing limit for states in the wake of the pandemic, tied the hike to certain conditions.

Citing benefits of capacity building, Sitharaman said the department of revenue, for instance, has spent a lot of time with the states to improve capacities. “That is why we find GST collection is going up,” she said. “It is going up, not just because people are paying more tax but also loopholes are plugged and also unroll, unregistered, unassessed people coming on board.”

Commerce and industry minister Piyush Goyal said the purpose of this BRAP exercise is to infuse a culture of learning from each other’s best practices and improve upon the business climate in each State/UT. The aim is to enable the whole of the country to emerge as the most favoured investment destination across the globe, Goyal said.

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