Emulate AP, TS in ease of doing biz, Assocham tells Centre

Hyderabad: Apex industry body Assocham on Thursday said that both the Centre and other state governments should replicate the ease of doing business model adopted by the governments of Andhra Pradesh and Telangana to attract more investments, both domestic and overseas.

Bestowing industrialists and entrepreneurs with the right to get clearances, time-bound approvals for every procedure, penalizing officials unnecessarily delaying clearances, online filing of returns, paying taxes and getting refunds together with online registration system for most procedures with a defined timeline of 24 hours for completion, are among the revolutionary steps taken by these state governments to improve ease of doing business, the industry body explained.

It may be recalled here that both the Telugu states shared the top rank in the ease of doing business rankings for 2016 announced by the Department of Industrial Policy & Promotion (DIPP) in association the World Bank “Both Andhra Pradesh and Telangana have been a forerunner in terms of promoting ease of doing business in their states as they started pursuing the same much before the Central Government,” Assocham president Sandeep Jajodia told the media here.

“The Centre along with other state governments should thus replicate the model of both these states, more so as they jointly shared the top position in the Ease of Doing Business (EoDB) rankings 2016 with Telangana making considerable improvement from its position in 2015 (13th rank),” said Jajodia.

He also complemented the Union Government for recent deregulation measures and efforts to improve the ease of doing business which has boosted foreign investment. “However, investment is still below potential due to the relatively high corporate income tax rates, slow land acquisition process, regulations which remain stringent in some areas, high non-performing loans which weigh on banks’ lending, and infrastructure bottlenecks, besides quality job creation has been weak, held back by complex labour laws,” Jajodia further said.

Echoing his views, D S Rawat, Secretary General, Assocham, said: “It is imperative for India to improve global rankings in terms of ease of doing business to attract domestic and foreign investments in large numbers and cut transaction costs for businesses”.

He also pointed out that introducing a one single window for construction permits, fastening the pace of digitising land records, implementing a stable, fair and predictable tax regime in the country, flexible labour laws and designing environment clearance in a way that responds in a time bound manner would go a long way in greatly improving the ease of doing business in India. India stood at 130th place among 189 countries in the EoBD rankings announced by the World Bank for 2016. India should aim at moving into top 50 club in EoBD rankings, he added.

Deal with NPAs in flexible way

Industry body Assocham urged the government and the Reserve Bank to take a pragmatic approach while resolving the complex issue of non-performing assets (NPAs) of the banks. Assocham president Sandeep Jajodia also urged the Centre that the NPA norms on getting the account classified under non-performing asset category for core sectors should be extended from 90 days to 180 days.

"For next two years, the RBI should be asked to ease this regulation (on converting standard account into an NPA, the 90-day limit for non-payment of interest or principal) from 90 day to 180 days specially for infra, power, steel and telecom companies," he said. An expert committee has been set up in this regard
and a representation will be submitted to government in the next few days, Jajodia added.