Doing Business in India 2009 Penelope Brook

Click to edit Master title style

Doing Business in India 2009

Penelope Brook Acting Vice President, Financial and

Private Sector Development The World Bank Group

New Delhi, June 30, 2009

Click to edit Master title styleAbout the Doing Business project

10 indicators covering regulations relevant to the life cycle of

a domestic small to medium-size firm

Focus on smart regulation – efficient, streamlined, accessible

Six years (2004-2009) of data collection and benchmarking

Impact in informing reforms

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Click to edit Master title styleMore economies reform business regulations

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More than 1,000 business regulation reforms tracked by Doing Business since 2004

115 economies implemented start-up reforms

154 of 181 economies reformed in at least one of 10 areas covered in Doing Business

Over 175 reforms in 69 economies informed by Doing Business

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185213 200

239

5899 112 98 113

0

100

200

300

DB05 DB06 DB07 DB08 DB09

Reforms per Publication YearNumber of reformsEconomies

Click to edit Master title styleSubnational Doing Business Project

Expands the DB indicators beyond the most populous city

Captures local differences in regulations or enforcement

Includes rules and regulations at all levels of government

Gives specific locations an opportunity to tell their story

Provides a tool for locations to compete globally

Provides information on good practices within the same country

that can be easily replicated

Combines media appeal of DB with active participation of

subnational governments in the reform process

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20052006200720082009

Countries: 36

Cities: 266

Subnational Doing Business has projects all around the globe

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Subnational Doing Business in India 2009

7 topics measured in India:

Starting a businessDealing with construction permitsRegistering propertyEnforcing contractsTrading across bordersPaying taxesClosing a business

Data were collected with the help of 280 private sector contributors and 230 public sector officials


Gujarat

Kerala

Doing Business in India covers 17 locations

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Ludhiana

New Delhi

Jaipur

Ahmedabad

Mumbai

Bengaluru

Kochi

Gurgaon

Guwahati

Patna

Ranchi

Kolkata

Indore

Bhubaneshwar

Hyderabad

Chennai

Noida


Rank City, State Rank City, State

1 Ludhiana, Punjab (easiest) 10 Mumbai, Maharashtra

2 Hyderabad, Andhra Pradesh 11 Indore, Madhya Pradesh

3 Bhubaneshwar, Orissa 12 Noida, Uttar Pradesh

4 Gurgaon, Haryana 13 Bengaluru, Karnataka

5 Ahmedabad, Gujarat 14 Patna, Bihar

6 New Delhi, Delhi 15 Chennai, Tamil Nadu

7 Jaipur, Rajasthan 16 Kochi, Kerala

8 Guwahati, Assam 17 Kolkata, West Bengal

9 Ranchi, Jharkhand

Source : Doing Business database.

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Doing business in India: Where is it easiest?

Click to edit Master title styleStarting a business: Time and cost to start a business in India and selected

economies

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Click to edit Master title styleStarting a business in Noida – fastest in India together with Mumbai

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Dealing with construction permits: Some cities have a more efficient approval

process

Click to edit Master title styleRegistering property:

Time and cost vary significantly across states

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Click to edit Master title stylePaying taxes: Indian businesses make numerous tax payments

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Trading across borders: Exporters spend most time on paperwork

Click to edit Master title styleEnforcing contracts: Lengthy delays during judgment/trial

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Click to edit Master title styleClosing a business: average time, cost and

recovery rate as compared to world regions

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Click to edit Master title styleIndian cities are reforming…

* Locations measured by Doing Business in South Asia 2007

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Click to edit Master title style… thanks to reforms, registering property in Jaipur is fastest in India

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Click to edit Master title style“Indiana” would rank 67th globally if

regional best practices were adopted in other cities

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IndicatorIndia’s

performance in DB09

Best performing cityBest local practice

Global rank

Days to deal with construction permits 224 days Hyderabad 80 days 19

Cost to enforce a contract 39.6% of claim Patna 16.9% of claim 31

Days to register property 45 days Jaipur 24 days 49

Days to import 20 days Bhubaneshwar 16 days 50

Days to export 17 daysAhmedabad,

Bhubaneshwar, Mumbai17 days 59

Time to pay taxes 271 hours Jaipur 233 hours 91

Cost to deal with construction permits 414.7% of GNI Patna 204% of GNI 94

Days to start a business 30 days Mumbai, Noida 30 days 104

Cost to register property 7.5 % of value Ranchi 5.4% of value 104

Days to enforce a contract 1420 days Guwahati 600 days 111

Cost to start a business 70.1 % of GNI Patna 38.5% of GNI 124

Recovery rate for closing a business 10.4 cents/$ Hyderabad 15.9 cents/$ 133

Total tax rate 71.5% of profit Noida 66.5% of profit 162

Tax payments 60 payments Ludhiana, Noida, Mumbai, Belgaluru

59 payments/y166


Evidence from business start-up reform in MexicoEvaluation of impact on formal firm creation of a municipal reform which decreased the time to obtain an operation license from average 30 to 2 days in 93 municipalities.

Increase in new start-ups by about 4% (Kaplan, 2006)Increase in employment in eligible industries by 2.8% (Bruhn, 2008)

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Business regulation reform matters

Indicative of how policy reform can lead to substantial real impact

Click to edit Master title styleDoing Business in India 2009

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Doing Business in India 2009 Penelope Brook