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Post at: Oct 08 2021

Ease of Doing Business

Why in news

  • In September 2021, the World Bank Group scrapped its flagship publication, the ‘Ease of Doing Business’ report. 
  • This report published the influential annual ranking of countries on the Ease of Doing Business (EDB) index.
  • It will be working on a new approach to assessing the business and investment climate.

What’s the issue?

  • In August 2020, World Bank paused the publication of Doing Business reports following a number of irregularities were reported regarding changes to the data.
  • The irregularities in Doing Business reports had affected four countries: China; Saudi Arabia; United Arab Emirates; and Azerbaijan.
  • A probe of data irregularities cited “undue pressure” by top bank officials, including the then-Chief Executive Kristalina Georgieva, to boost China’s ranking in 2017.
  • This raised ethical matters involving former bank staff and board officials.

About the report

  • The report was introduced in 2003 to provide an assessment of objective measures of business regulations and their enforcement across 190 economies on ten parameters affecting a business through its life cycle.
  • 10 different parameters namely, 
    • Starting a Business,
    • Dealing with Construction permits,
    • Electricity availability, 
    • Property registration,
    • Credit availability, 
    • Protecting minority Investors, 
    • Paying Taxes, 
    • Trading across borders, 
    • Contracts enforcement, and 
    • Resolving Insolvency.
  • India's performance in report

  • India jumped 23 spots from 100th in 2017 to 77th in 2018.
  • India was at the 130th spot in 2016.
  • India has improved its rank by 53 positions in the last two years, (2016-2018) and 79 positions in the last five years (2014-19).
  • Now, India is the best-ranked country in South Asia and has almost caught up with other competitors like Indonesia (73) and Vietnam (70).
  • The World Bank report also recognises India as one of the “top ten improvers” in this year’s assessment, for the second consecutive time. India is one of only 9 economies around the world and only one in BRICS nations to be included in this list.

In Ease of Doing Business Report, 2020,

  • India was placed at 63rd position this time (2019) out of 190 countries marking an improvement of 14 places from its 77th position in 2018.
    • India’s score improved from 67.23 in the previous year to 71.0 this year.
    • India for the third consecutive year was present in the list of 10 economies where the business climate has improved the most.

Way forward

  • Going forward, the World Bank Group should work on a new approach to assessing the business and investment climate.


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