Blitz Bureau
NEW DELHI: For nearly a decade, ‘Ease of Doing Business’ has been one of India’s most persistent economic slogans. It delivered results on paper: India jumped from 142nd place in the World Bank rankings in 2014 to 63rd by 2020. Yet for many entrepreneurs and investors, the lived experience of doing business in India remains uneven. The reason is simple. While procedures have improved, the underlying ecosystem has changed only partially.
What has unquestionably improved is the front-end interface between the state and business. Company incorporation that once took weeks can now be completed in days. GST replaced a maze of indirect taxes with a unified system, reducing interstate friction even if compliance remains demanding.
Digital platforms have transformed filings, approvals and payments. The Insolvency and Bankruptcy Code (IBC), despite setbacks, has altered creditor behaviour and improved capital discipline. For large firms and organised players, these reforms have lowered transaction costs.
India has also made progress in formalising economic activity. The spread of GST, digital payments and Aadhaar-linked processes have brought more firms into the tax net. This has improved transparency, even if it has increased compliance pressure on small businesses. From the Government’s perspective, the trade-off has been acceptable.
But ‘Ease of Doing Business’ is not merely about speed and digitisation. It is about predictability, trust and dispute resolution — areas where India still struggles.
A major gap is the regulatory overhang. Despite repeated assurances, rules often change mid-stream. Tax interpretations vary across jurisdictions, and retrospective anxieties, though diminished, have not fully faded.
For investors, policy stability matters as much as incentives. The fact that businesses still budget for litigation as a cost of operating in India is revealing.
The second unresolved issue is state-level divergence. While some states have streamlined approvals, land processes and labour rules, others lag badly. India’s federal structure means Central reforms succeed only where local implementation is effective. A factory’s ease of operation can still depend heavily on its location.
Third, India continues to suffer from judicial delays. Contract enforcement remains slow despite commercial courts and arbitration reforms. For MSMEs, delayed payments and stalled cases can be fatal. With the World Bank index discontinued, there is also a risk that reform urgency could weaken without an external benchmark.
There is also compliance overload. Digitisation has often meant moving paperwork online rather than eliminating it. Multiple filings across labour, environment, tax and corporate laws continue to burden smaller firms disproportionately.
Perhaps the clearest indicator of incomplete reform lies in business behaviour itself. Indian firms still prefer consolidation over greenfield expansion. Foreign investors often enter through acquisitions or joint ventures rather than building from scratch — rational choices in an environment where enforcement and approvals remain costly.
‘Ease of Doing Business has improved’ but unevenly. India has moved from opaque to procedural, but it has yet to become truly predictable. The next phase of reform must focus less on optics and more on outcomes: stable rules, faster courts, empowered states and fewer, simpler compliances. Only then will ‘Ease of Doing Business’ become a lived reality rather than a slogan.