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Telangana continues to be topper in Ease of doing Business (EoDB) in India





With just one week left for uploading evidence of reforms implemented for determining the ‘Ease of Doing Business’ (EoDB) index in various States, Telangana continues to top the annual rankings.

Telangana is followed by Haryana and West Bengal at second and third places respectively in the ranking given by the Department of Industrial Policy and Promotion (DIPP) of the Union Ministry of Commerce and Industry.

Initiative:

The World Bank kicked off a global initiative called ‘Ease of Doing Business’ in 2001 and started ranking countries based the prevailing business climate there. These rankings are the one of the factors that global investors take into reckoning while making their investment decisions.Unfortunately, India’s highest rank is 116 among 196 countries in 2006, which is slipped down to 142 in 2015. Three years back, the action plan actually started by Narendra Modi government to take necessary actions to overcome the poor performance of India. It was believed that India is a difficult,highly complex and complicated place to do business because of its age old rules and regulations, procedures built over the years and all these have been trying to dismantle by the Modi government so that India becomes easy for investors.

In the last three years this work has been undertaken with single minded pursuit, structural reforms vigorously driven, procedures simplified, rules modified and almost 1200 laws abolished. The measures put together have been unprecedented.

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In the last three years India’s Ease of Doing Business rank has jumped up from 142 to 100 – a jump of 42 positions. The World Bank’s ranking is important as it is widely publicized and plays a significant role in positioning and branding a nation.India is a very large country, and much of the action relating to investments has shifted to states. It is therefore necessary that we make states easy and simple to do business in. Government has initiated competition among the states and union territories on defined outcomes of Ease of Doing Business.

There has been heavy competition. In the first year Gujarat came number one.The second year, Telangana and Andhra Pradesh beat Gujarat for the first spot. Now, in the second quarter of 2017, Telangana state beat other states like Karnataka and Gujarat and continued its secured place as a topper in the ranking list.

Competition among states:

The second quarter of 2017 was an important one for India: it saw the country move to the cusp of the goods and services tax (GST), a landmark reform that has made India into a unified economic market. Amidst this and other major economic and political events, some of India’s states continue to undertake reforms and enact policies that set them apart. In the second quarter, several states showed positive movement across a few key sectors: power, education, governance capacity, innovation and manufacturing.

Unfortunately, reform initiatives are not evenly distributed. “A few states—Karnataka, Telangana, Madhya Pradesh, Maharashtra, and Haryana—have enacted multiple reforms, while others never make an appearance. Inter-state divides are immense and will continue to grow unless all states enact forward-looking reforms.” – Reported livemint.com in its article on business reforms in India.





What makes Telangana best for EoDB:

Power reforms: Increased power capacity and power sector reforms are imperative for states to provide adequate power while maintaining fiscal health. The task is clear: improve discom health and bring more energy into an expanding distribution network. One of the most direct measures is increasing tariffs and improving tariff collection. To make it possible, TS government has started reforms in its power sector. State-run Power Finance Corp (PFC) has sanctioned a term loan of Rs 4,009 crore to TSGENCO (Telangana Power Generation Corporation Ltd) for setting up 5X800 MW, coal based Yadadri Thermal Power Plant using super-critical technology in Nalgonda district of Telangana.

The Yadadri Thermal Power Plant will generate approximately 29,784 million units of energy to meet the future power requirement of Telangana.

In Solar Power sector, Telangana surpassed Gujarat and became the top producer of the country. Data from September shows that Telangana generates 2,792 MW of solar power, followed by Rajasthan at 2,219 MW, according to the report. Gujarat has slipped to sixth position, and produces 1,384 MW of solar power.

Knowledge and innovation reforms:

States are unleashing new regulations and forming innovative partnerships to shape the education sector. In addition, to attract skills and drive economic growth, they are creating institutions to spur innovation.

Telangana is a good example with its new Rural Technology Policy that sets a goal of establishing one technology centre in every district, with each centre capable of providing jobs to 2,500 people and training to over 10,000 rural youth.

Technology services:

Implementing new policies and getting services to their tens of millions of citizens is no easy feat for India’s states. They are creating new channels to reach out to their citizens and adopting policies to improve their decision-making capacity.

Telangana took the lead in terms of implementation of online portals to disseminate resources to citizens, including the use of direct benefit transfer payments to 5.5 million farmers for fertilizer subsidies, as well as a new digital payment app, T-Wallet, to send wages to participants in rural employment programmes and for remittance of scholarships.

Land & Manufacturing reforms:

Smart, simple regulations and policies on land and manufacturing can help drive economic growth and improve the ease of doing business. In this context, eight states—Bihar, Chhattisgarh, Maharashtra, Jharkhand, Punjab, Rajasthan, Tamil Nadu, and Uttarakhand—passed their own versions of the Real Estate Regulation and Development Act, which came into effect on 1 May.

Telangana’s new land transparency act came into effect, removing barriers to the state’s exercise of eminent domain,which hugely helps the government as it wants to acquire one lakh acres to complete all pending irrigation projects in the state.

Other reforms:

The second quarter of 2017 revealed that most of the India’s states implementing some innovative and positive reforms, especially states like Telangana leading the league by attracting international investments in almost all segments. Telangana government recently drafted its own policy on electric vehicles in transport sector, soon unveil its security operations centre in Cyber sector, T-Government announced its e-waste policy and aims to create more than 50k jobs with its new IoT policy.

According to Assocham, Telangana tops with 79% growth by providing investor-friendly environment with its T-iPass policy, started its own T-Fiber Grid to connect urban people with broad band along with water pipe lines. The TS government also announced to provide incentives to text tile industries, especially to the handloom weavers form villages will be encouraged by introducing their products to the online portals like Amazon, to whom with the T-government has an MoU.

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Ashok Kumar

Dr. Ashok Kumar is Chemistry Professor, Blogger, Film maker, Writer and Traveler.

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