Doing Business 2008 - India a good destination
South Asia picked up the pace of regulatory reform over the past year to become the second-fastest reforming region in the world, on par with the speed of reform in the countries of the OECD, finds Doing Business 2008. The report is the fifth in an annual report series issued by the World Bank and IFC. Last year South Asia ranked lowest on the rate of reform; this year two-thirds of its countries had at least one reform.
The pickup in reform was led by India, which rose 12 places on the ease of doing business and made the reform of business regulation a policy objective. India was the top reformer worldwide in trading across borders. Bhutan and Sri Lanka are the other top reformers in South Asia this year.
Singapore, for the second year running, tops the aggregate rankings on the ease of doing business. The top-ranking countries in South Asia are Maldives (60) and Pakistan (76). India improved its ranking to 120th this year--achieving a bigger gain than China, which rose by nine places to 83rd.
India is now setting the standard for reform in South Asia, with an explicit policy objective to become a leading business-friendly economy. Besides making it easier to trade across borders, India increased access to credit by expanding credit bureau coverage to individuals as well as businesses. It also introduced an electronic registry for security rights granted by companies.
Pakistan extended overtime limits for retail workers and made working hours more flexible. The country's private credit bureau now reports both positive and negative information on borrowers and stores more information on loans. The public credit registry eliminated its loan threshold, boosting coverage by a factor of 20.
One way to spur reforms is to compare cities within a country. Doing Business finds that the time to obtain a business license in India ranges from 159 days in Bhubaneshwar to 522 in Ranchi. The time to register property ranges from 35 days in Hyderabad to 155 in Calcutta. If the top score among Indian cities in each of the Doing Business indicators were used for the country as a whole, India would rise 55 places in the aggregate country rankings. The Indian government is using this information to plan further reform.
Doing Business 2008 ranks 178 economies on the ease of doing business. The top 25 in the overall rankings are, in order, Singapore, New Zealand, the United States, Hong Kong (China), Denmark, the United Kingdom, Canada, Ireland, Australia, Iceland, Norway, Japan, Finland, Sweden, Thailand, Switzerland, Estonia, Georgia, Belgium, Germany, the Netherlands, Latvia, Saudi Arabia, Malaysia, and Austria.
The rankings are based on 10 indicators of business regulation that track the time and cost to meet government requirements in business start-up, operation, trade, taxation, and closure. The rankings do not reflect such areas as macroeconomic policy, quality of infrastructure, currency volatility, investor perceptions, or crime rates. Since 2003 Doing Business has inspired or informed more than 113 reforms around the world.