Following up on its 'Make in India' campaign, the Narendra Modi government is taking steps to cut down the time for registering a business from 27 days to a single day.
This is part of a raft of measures, such as single registration for all labour laws, overhaul of tax systems, reduction in the number of permits required, easing up property registration, quick electricity connection and property registration.
These measures that are expected to make the country a friendlier investment destination, according to a Times of India report.
India has long had the dubious reputation of being a notoriously difficult place to do business. The World Bank's 'Ease of Doing Business' index this year ranked India at 134 out of 189 countries, behind not only China (ranked 96) but its poorer neighbours Pakistan (110) and Bangladesh (130).
During the launch of the 'Make in India' campaign, Narendra Modi had announced that his government would take steps to bring the country's ranking among the top 50.
The Department of Industrial Policy and Promotion (DIPP) has been made the nodal agency for pushing these procedural reforms. The DIPP has set a time frame of 3-6 months for implementing the changes. It has asked all ministries to work on reforming the regulatory structure and the investment climate. States are also being encouraged to join the Centre's efforts to improve the regulatory structure and cut down delays.
Among the focus areas are reforms of the tax system. It has been suggested that the number of taxes be reduced and online payment of taxes allowed. Education and higher education cess, dividend and withholding taxes can be incorporated under corporation tax to simplify the process, officials said.
The Minimum Alternate Tax (MAT) for developers of special economic zones (SEZs) and units in SEZs is proposed to be abolished. There is emphasis to expeditiously implement the Direct Tax Code and goods and service tax (GST).
The DIPP has cited examples from various countries such as Malaysia, New Zealand, Canada, Rwanda, Turkey and the UAE for easing up the processes and reducing delays. It has also been suggested that the requirement of minimum paid-up capital for starting a business should be done away with, as 90 countries have no such requirement.
For removing hurdles in getting electricity for businesses several measures have been identified which include removing the requirement of pollution control certificates for providing a connection. State electricity boards and the power ministry have been asked to simplify procedures of getting an electricity connection.