India’s transition towards a facilitation-driven business ecosystem through digital governance, regulatory simplification, and trust-based administration, significantly improving the Ease of Doing Business.
About Ease of Doing Business (EoDB)
- Ease of Doing Business (EoDB) measures how easily businesses can start, operate, expand, and access legal and administrative support by evaluating factors such as regulations, costs, time requirements, and compliance burden.
Importance
According to economist Adam Smith, economic growth requires:
- Peace
- Easy taxation
- Efficient justice system
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Indicators of EoDB
Major pillars
- Starting a business
- Getting permits
- Access to credit
- Property registration
- Tax system
- Contract enforcement
India’s Progress
India improved its ranking:
However, the World Bank discontinued the Doing Business Index after 2021 due to data-related concerns.
A new framework called Business Ready (B-READY) was introduced.
Government Initiatives to Improve Ease of Doing Business
1. Startup India
- Startup India, launched in 2016, aims to promote entrepreneurship and transform job seekers into job creators.
- It supports startups through initiatives such as:
- Seed funding for early-stage businesses.
- Fund of Funds to provide financial support.
- Credit guarantee schemes to improve access to finance.
2. SPICe+ Portal
- The SPICe+ portal simplifies the process of starting a company by providing multiple services through a single digital platform.
- It facilitates:
- Company registration
- PAN and TAN generation
- EPFO registration
3. Udyam Registration
- Udyam Registration provides a simplified and paperless process for MSME registration.
- Its key features include:
- Easy registration process
- Paperless compliance
- Self-declaration-based system
4. Digital Governance
- Digital governance initiatives have reduced procedural delays and improved transparency through platforms such as:
- Government e-Marketplace (GeM)
- Digital land records
- MCA digital systems
- Online approval mechanisms
Challenges in Ease of Doing Business
1. Contract Enforcement Challenges
- Huge judicial pendency: Large number of pending cases delay dispute resolution.
- Delayed justice delivery: Long legal procedures reduce investor confidence and business certainty.
2. Regulatory Complexity
- Multiple regulations: Businesses face different rules across states.
- Labour law variations: Different state-level labour regulations increase compliance burden.
- Land and compliance requirements: Complex procedures create difficulties for companies.
3. Land Acquisition Issues
- Ownership disputes: Unclear land titles often create legal conflicts.
- Slow acquisition process: Delays in approvals affect industrial projects and investments.
4. High Logistics Costs
- Higher transportation expenses: Logistics costs in India remain around 13–14% of GDP compared to 7–8% in developed economies.
- Infrastructure gaps: Inefficient supply chains increase the cost of doing business.
5. MSME Sector Challenges
- Limited digital literacy: Many small businesses struggle to adopt digital tools.
- Credit access difficulties: MSMEs face challenges in obtaining affordable finance.
- Low awareness: Limited knowledge about digital platforms and government support schemes affects growth.
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Way Forward
- Harmonise regulations: Create uniform and simplified rules across states.
- Encourage healthy competition among states: Promote reforms through state-level performance rankings and innovation.
- Judicial Reforms: Faster dispute resolution: Reduce delays through efficient courts and improved judicial capacity.
- Promote arbitration and mediation: Encourage alternative dispute resolution mechanisms for quicker settlements.
- Integrate government portals: Create seamless digital platforms for approvals, registrations, and compliance.
- Reduce paperwork: Promote transparent and efficient online governance.
- Implement National Logistics Policy: Reduce logistics costs and improve supply chain efficiency.
- PM Gati Shakti: Enables integrated planning of infrastructure projects and better connectivity.
- Decriminalisation of minor offences: Small compliance mistakes should attract financial penalties rather than criminal punishment.
- Promote business confidence: Shift from control-based regulation to facilitation and trust-based governance.
9 Jun 2026
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