Lok Sabha Question No. 1312 (UNSTARRED), answered on 2016-07-25
Subject: Ease of Doing Business
Ministry: COMMERCE AND INDUSTRY
Asked by: MANSHANKAR NINAMA, BHOLA SINGH

## GOVERNMENT OF INDIA MINISTRY OF COMMERCE & INDUSTRY DEPARTMENT OF INDUSTRIAL POLICY & PROMOTION

## LOK SABHA

UNSTARRED QUESTION NO. 1312. TO BE ANSWERED ON MONDAY, THE 25 TH  JULY, 2016.

## EASE OF DOING BUSINESS

## 1312.  SHRI MANSHANKAR NINAMA: SHRI BHOLA SINGH:

Will the Minister of COMMERCE AND INDUSTRY be pleased to state:

## वाणिज्य एवं उद्योग मंत्री

- (a) the performance of India in the recently released World Bank's 'Ease of Doing Business' Index, 2015;
- (b) whether  India's  position  has  improved  in  the  latest  edition  of  'Ease  of  Doing Business' Index and if so, the details  thereof;
- (c) whether the ranking of India in the said index is likely to improve in 2016;
- (d) if  so, the details thereof along with the measures taken by the Government to promote India's performance in 'Ease of Doing Business' and if not, the reasons therefor; and
- (e) the reasons for low manufacturing base in the country along with the measures taken by the Government to promote manufacturing sector in India?

## ANSWER

## वाणिज् य एवं उद्योग ााज् यमंत्री स् वतंंत्र ्रभााा(स्ीमतंी िरममलाा ीीतंाामि( THE MINISTER OF STATE (INDEPENDENT CHARGE) OF THE MINISTRY OF COMMERCE & INDUSTRY (SHRIMATI NIRMALA SITHARAMAN)

- (a): India's overall rank in Doing Business Report, 2015 was 142 nd .  Indicator-wise ranks are as follows:

|   S. No. | Indicator Set                     |   Rank |
|----------|-----------------------------------|--------|
|        1 | Starting a business               |    158 |
|        2 | Dealing with construction permits |    184 |
|        3 | Getting Electricity               |    137 |
|        4 | Registering property              |    121 |
|        5 | Getting credit                    |     36 |
|        6 | Protecting minority investors     |      7 |
|        7 | Paying taxes                      |    156 |
|        8 | Trading across borders            |    126 |
|        9 | Enforcing contracts               |    186 |
|       10 | Resolving insolvency              |    137 |

India's overall rank in the Doing Business Report, 2016 which was released in October, 2015 was 130 th .

- (b): Yes. India's overall rank in the latest Doing Business Report, 2016 released on 28 th October,  2015  has  been  improved  to 130 th .  Indicator-wise  ranks  are  as follows:
- (c): The ranking of India in the said index in the upcoming Doing Business Report, 2017 to be released in 2016 will be based on the reform measures undertaken by Govt. of NCT  of Delhi and Government of Maharashtra and the Ministries/Departments concerned.
- (d): The measures taken by the Government to promote India's performance in 'Ease of Doing Business' are given at annexure.
- (e): The measures undertaken by the Government to promote manufacturing are: (i) announcement of the National Manufacturing Policy which entails measures to  improve  industrial  infrastructure,  simplify  business  regulations,  incentivize clean  technology,  skill  development,  and  investment  in  MSMEs.  (ii)  The Government  has  launched  the  'Make  in  India' initiative,  which aims  at promoting  India  as  an  important  investment  destination  and  a  global  hub  for manufacturing,  design  and  innovation.      The  initiative  is  aimed  at  creating  a conducive  environment  for  investment,  modern  and  efficient  infrastructure, opening  up  new  sectors  for  foreign  investments  and  forging    partnerships between government and industry.

|   S. No. | Indicator Set                     |   Rank |
|----------|-----------------------------------|--------|
|        1 | Starting a business               |    155 |
|        2 | Dealing with construction permits |    183 |
|        3 | Getting Electricity               |     70 |
|        4 | Registering property              |    138 |
|        5 | Getting credit                    |     42 |
|        6 | Protecting minority investors     |      8 |
|        7 | Paying taxes                      |    157 |
|        8 | Trading across borders            |    133 |
|        9 | Enforcing contracts               |    178 |
|       10 | Resolving insolvency              |    136 |

*****

## Mumbai

-  Requirement of inspection has been removed to make registration of Shops and Establishments real-time.
-  Commercial  divisions  and  appellate  divisions  have  been  established  in Bombay High Court.
-  VAT and Profession tax registration has been integrated into a single process.
-  Municipal Corporation of Greater Mumbai (MCGM) has introduced fast track approval system for building permits with features such as:
- I. Common application form
- II. Online transfer of application and receipt of NOC
- III. Online system has been integrated with AAI & NMA.
-  Brihanmumbai  Electricity  Supply  and  Transport  (BEST)  has  improved  its System  Average  Interruption  Duration  Index (SAIDI)  by  3%  and  its  System

## ANNEXURE

ANNEXURE  REFERRED  TO  IN  REPLY  TO  PART  (d)  OF  THE LOK SABHA UNSTARRED QUESTION NO. 1312 FOR ANSWER ON 25.07.2016.

## Ease of Doing Business

India's  rank  in  the  Doing  Business  Report  2015  was  142  among  189  countries, which improved to 130 in the Doing Business Report, 2016.  Government of India has emphasized on the importance of 'Ease of Doing Business' and it is a major pillar of 'Make  in  India'  initiative.  It  is  working  extensively  on  improving  India's  rank  in  the World Bank Group's Doing Business Study.

## A.      ACHIEVEMENTS IN DELHI AND MUMBAI Delhi

-  Unified building Bye-laws has been notified.
-  Online registration of Value Added Tax (VAT) with real-time Tax Identification Number (TIN) allotment has been introduced.
-  Delhi  VAT  Sewa  App  has  been  developed  whereby  permanent  business registration is done without need for field verification by VAT inspector. This step  has  eliminated  instances  of  corruption  and  irregularities  during  field verification.
-  Commercial divisions and appellate divisions in Delhi High Court have been established.
-  Municipal  Corporations  have  introduced  fast  track  approval  system  for building permits with features such as:
- I. Common application form
- II. Use of digital signature for filing application and issue of permits
- III. Online transfer of application and receipt of NOC
- IV. Online system has been integrated with Airport Authority of India (AAI),  Delhi  Urban  Arts  Commission  (DUAC),  Delhi  Metro  Rail Corporation (DMRC) & National Monument Authority (NMA).

Average  Interruption  Frequency  Index (SAIFI)  by  11%  in  the  period  June, 2015-March, 2106.

-  Permission  for  removal  of  Trees  has  been  integrated  with  the  Municipal Corporation of Greater Mumbai (MCGM) single window application system.
-  Site inspection for construction permits has been minimized by way of selfcertification  and  introducing  third  party  certification.  During  construction, submission  of  video  clips  by  architects  has  been  introduced  in  online  Auto DCR system.
-  VAT Registration Certificate is issued within 1 working day (24 hours).
-  AutoCAD based software to scrutinize building plans has been implemented.
-  MCGM  has  implemented  a  risk  based  assessment  framework  with  risk parameters in order to enable fast track approval for buildings.
-  Cost and time for obtaining construction permit has been reduced by 79.6% and 132 days respectively.
-  Property Tax can be paid through mobile app, which can be downloaded from apps.mgov.gov.in.

## B. REFORMS UNDERTAKEN ON VARIOUS PARAMETERS OF DOING BUSINESS

## 1.  STARTING A BUSINESS

-  Registration with ESIC and EPFO has been made real-time by eliminating all physical touch-points.
-  The  requirement  of  opening  a  bank  account  has  been  removed  as  a mandatory condition for registration with ESIC and EPFO.
-  The system of issuing PAN and TAN has been put in place together within T+1 days on an application using digital signatures on the ebiz platform. PAN and TAN numbers can be issued on CBDT's portal within T+3 days. without digital signature.
-  Maharashtra  state  has  combined  the  process  of  registration  with  VAT  and Profession tax. The registration will now be granted in 24 hours and the same has been adopted by Delhi VAT.
-  Form INC 29 has been launched by Ministry of Corporate Affairs to avail 3 pre-registration services viz. 'Name Availability', 'Director Identification Number' and 'incorporation of company' with one form and one payment.
-  No  environment  clearance  that  is  ,  consent  to  establish  and  operate  is required for 36 white industries.
-  Mine prospecting projects are exempted from the requirement of compensatory afforestation and Forest Rights Act (FRA) certificate for grant of forest clearance.
-  No site inspection is required for mine prospecting projects on forestland for less than 100 ha. For construction of new roads/drilling of bore hole/ sample collection pits.
-  Industrial  sheds  and  educational  institutions  have  been  exempted  from Environmental Clearance (EC).
-  Validity of EC has been increased from 5 years to 7 years.
-  Online  submission  of  applications  for  environment/forest/wildlife  clearances for transparent and expeditious decision-making.
-  District  Environment  Impact  Assessment  authority  has  been  constituted  to grant EC for mining of minor minerals for 5 ha. of individual lease and 25 ha. in cluster.
-  Regional empowered committees at sub national level have been delegated higher powers to dispose of proposals for Forest Clearance
- a)  Involving diversion of 5 to 40 hectares of forest land and
- b)  All proposals involving diversion of forestland for linear projects irrespective of area of forest land involved.
-  The competent authorities in the state government have been delegated the powers to issue permission for tree felling and commencement of work for a period of one year of linear projects without waiting for final approval under the FC Act.
-  EIA  notification,  2006  has  been  amended  delegating  more  powers  to SEIAA'S in respect of category B projects.

## 2.  CONSTRUCTION PERMITS

-  Municipal  Corporation  of  Greater  Mumbai  (MCGM)  has  completed  the process of single window approval by integrating with internal departments as well as, AAI and NMA through a common application form.
-  NoCs from Maharashtra Industrial Development Corporation (MIDC), Director of  Industries,  Collector  and  Maharashtra  Housing  and  Area  Development Authority (MHADA) have been eliminated.
-  MCGM has introduced digital signing of building permit application, as well as sanctioned maps, thereby eliminating need of physical submission of documents. The manual application for grant of construction permits has been discontinued.
- IV. Municipal Corporations of Delhi has completed the process of single window approval by integrating with internal departments as well as DMRC, Delhi Fire Services, DUAC, AAI and NMA through a common application form.



- V.  NOC  from  Labour  Department  of  Delhi  Government  is  not  required  if  no manufacturing activity is undertaken in the building.
2.  MCD has introduced digital signing of building permit application, as well as sanctioned  maps,  thereby  eliminating  the  need  of  physical  submission  of documents. Manual submission of application for grant of construction permits has been done away with.
3.  Ministry of Urban Development and Delhi Development Authority (DDA) have notified the Unified Bye-laws.
4.  Colour coded maps have been developed by AAI, NMA, DUAC and DMRC to enable applicants to determine whether NOC is required for the land for which permission is applied for.
5.  AAI,  NMA,  DUAC,  DMRC,  Delhi  Fire  service,  Mumbai  Metropolitan  Region Development  Authority (MMRDA)  and  Mumbai  Metro  Rail  Corporation (MMRC) have created their own independent online application systems for receiving  and  issuing  NOC/approval.  Their  requirements  have  also  been integrated in the common application form developed by SDMC/MCGM.

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## 3.  GETTING ELECTRICITY

-  Maharashtra  and  Delhi  have  implemented    lump-sum  charges  for  electric connection thereby removing the need of an estimate and an inspection for the same.
-  Online application for connections above 100KVA has been made mandatory in Maharashtra and Delhi.
-  Delhi Electricity Regulatory Commission (DERC) has rationalized LT and HT tariff thereby allowing LT connections upto 150KVA.
-  DERC has revised the application format of Delhi Electric Supply Code and Performance  Standards  Regulations,  2007  for  faster  release  of  electricity connection. The distribution licensees have been directed to process applications in the revised format along with the declaration form.

Following are the two documents required for getting electricity connection:

1.  Identity proof
2.  Proof of ownership/ occupancy of premises.
3.  NOC/Consent  to  Establish  is  not  required  for  getting  industrial  electricity connection for setting up new industries and projects.

## 4.  TRADING ACROSS BORDERS

-  Central  Board  of  Excise  and  Customs  (CBEC)  has  implemented  Single Window  Interface  for  Facilitating  Trade  (SWIFT)  (online  single  window  for clearance  of  goods)  on  the  ICEGATE  portal  by  integrating  FSSAI,  Animal Quarantine, Plant Quarantine, Drug Controller and Wildlife Control Bureau for imports.
-  Online message exchange system connectivity under single window system between  Customs'  ICEGATE  and  Plant  Quarantine  Information  System (PQIS) has been implemented for import clearances of Agriculture commodities.
-  Customs'  risk  management  system  has  been  extended  to  other  regulatory agencies to ensure risk- based inspections.
-  168 low phytosanitary risk agricultural commodities listed under schedule VII of  the  Plant  Quarantine  order,  2003  have  been  identified  for  5%  random inspection.
-  Mandatory  testing  of  imports  from  countries  where  azo  dye  has  not  been banned has been reduced to 25%.
-  TEU  volume  limit  on  the  number  of  consignments  released  under  direct delivery has been removed facilitating prompt delivery of goods.
-  Terminal handling receipts have been eliminated from Jawaharlal Nehru Port Container Terminal, GTI and NSICT by web based e-form 13.
-  Filing of import and export declarations and manifests has been made online with digital signature.
-  An electronic messaging system between Shipping lines and Custodians for electronic delivery order has been introduced.
-  Customs' Clearance Facilitation Committee has been set up at every major customs seaport and airport at Central level.

C

## ONLINE PORTAL

-  One-stop access for Investors to know more about Investment opportunities and information on number of licenses/approvals required from Government agencies.
-  User-friendly  features such as Payments through netbanking, credit & debit cards, status tracking, SMS alerts and Help-desk support enabled.
-  Single  face  of  Government  -  Composite  Application  Form  and  one-time payment designed for obtaining approvals from multiple Ministries/Departments  viz.,  Ministry  of  Corporate  Affairs,  Central  Board  of Direct  Taxes,  Ministry  of  Labour  &  Employment  including  Employees'  State Insurance Corporation & Employees Provident Fund Organization.
-  The system of physical control and locking of public and private warehouses by  Customs  has  been  dispensed  with  and  replaced  with  record  based controls.
-  24x7 customs clearance facilities have been extended to 19 seaports and 17 air cargo complexes.
-  Documents required for export and import has been reduced to three.

## 5.  RESOLVING INSOLVENCY

-  The Insolvency and Bankruptcy Code 2016, a legislation that is expected to introduce new dimensions in resolving insolvency in India has been enacted.

## 6.  ENFORCING CONTRACTS

-  The Arbitration  and  Conciliation  Act  has  been  amended  to  reduce  the  time taken  in  arbitration  proceedings  and  grounds  on  which  an  award  may  be challenged.
-  Commercial Appellate Division Bench and Commercial Division Benches are functioning in Bombay High Court and Delhi High Court.

## 7.  DIGITIZATION PROCESS FOR REGISTERING PROPERTY

-  In  Delhi,  all  sub-registrar  offices  have  been  digitized  and  Sub-registrar's records have been integrated with the Land Records Department.
-  In Maharashtra, all property tax records have been digitized.

## 8.  GETTING CREDIT

-  SARFAESI  (Central  Registry)  Rules,  2011  has  been  amended  to  record security interest created on all types of property covered by the definition of property  in  Section  2(1)(t)  of  the  SARFAESI  Act,  2002.covered  by  the definition of property in Section 2(1)(t) of the SARFAESI Act, 2002.
-  Elimination of multiple visits to different agencies. Investor can apply for 20 Central  Government  services;  14  Andhra  Pradesh,  14  Odisha  and  2  Delhi state  Government  services  have  been  integrated  with  eBiz  IT  platform  as detailed below.

## CENTRAL GOVERNMENT SERVICES INTEGRATED ON e-biz PLATFORM

|   S.No. | Ministry/ Dept. Name                          | Service Name                                                                             |
|---------|-----------------------------------------------|------------------------------------------------------------------------------------------|
|       1 | Employee's State Insurance Corporation        | Employer Registration                                                                    |
|       2 | Department of Industrial Policy and Promotion | Industrial License                                                                       |
|       3 | Department of Industrial Policy and Promotion | Industrial Entrepreneur Memorandum                                                       |
|       4 | Ministry of Corporate Affairs                 | Name Availability                                                                        |
|       5 | Ministry of Corporate Affairs                 | Director Identification Number                                                           |
|       6 | Ministry of Corporate Affairs                 | Certificate of Incorporation                                                             |
|       7 | Ministry of Corporate Affairs                 | Commencement of Business [1]                                                             |
|       8 | Central Board of Direct Taxes                 | Issue of Permanent Account Number (PAN)                                                  |
|       9 | Central Board of Direct Taxes                 | Issue of Tax Deduction Account Number (TAN)                                              |
|      10 | Reserve Bank of India                         | Advanced Foreign Remittance (AFR)                                                        |
|      11 | Reserve Bank of India                         | Foreign Collaboration-General Permission Route (FC- GPR)                                 |
|      12 | Employees' Provident Fund Organization        | Employer Registration                                                                    |
|      13 | Petroleum and Explosives Safety Organization  | Issue of Explosive License                                                               |
|      14 | Directorate General of Foreign Trade          | Importer Exporter Code License                                                           |
|      15 | Reserve Bank of India                         | Foreign Currency- Transfer of Shares [2]                                                 |
|      16 | Department of Heavy Industry (DHI)            | Issue of custom duty concession certificate to entrepreneurs under project import scheme |
|      17 | Central Board of Direct Taxes (CBDT)          | Changes or correction in PAN data                                                        |
|      18 | Ministry of Labour and Employment (MoL&E)     | Registration under the Contract Labour Act, 1970                                         |
|      19 | Ministry of Labour and Employment (MoL&E)     | Registration under the Building and other construction workers Act, 1996                 |
|      20 | Ministry of Labour and Employment (MoL&E)     | Registration under the Inter-State Migrant Workmen Act, 1979                             |

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## 1 Withdrawn from eBiz Portal w.e.f 15.07.2015 pursuant to the Companies (Amendment) Act 2015.

## STATE GOVERNMENT SERVICES INTEGRATED ON e-BIZ PLATFORM

| Andhra Pradesh (14 Services)   | Andhra Pradesh (14 Services)               | Andhra Pradesh (14 Services)                     | Andhra Pradesh (14 Services)                                          |
|--------------------------------|--------------------------------------------|--------------------------------------------------|-----------------------------------------------------------------------|
| S.No                           | Department Name                            | Department Name                                  | Service Name                                                          |
| 1.                             | AP-Ground Water Department                 | AP-Ground Water Department                       | Permission to draw Ground Water                                       |
| 2.                             | AP-Department of Factories                 | AP-Department of Factories                       | Approvals of plans from Factories Department                          |
| 3.                             | AP-Department of Factories                 | AP-Department of Factories                       | Factories License                                                     |
| 4.                             | AP-Department of Factories                 | AP-Department of Factories                       | Annual Filing under Factories Act                                     |
| 5.                             | AP-Fire Department                         | AP-Fire Department                               | NOC from Fire Services Department                                     |
| 6.                             | AP-Department of Industries                | AP-Department of Industries                      | Industrial Incentives (Power)                                         |
| 7.                             | AP-Department of Industries                | AP-Department of Industries                      | Industrial Incentives (VAT)                                           |
| 8.                             | AP-Department of Industries                | AP-Department of Industries                      | Allotment of Scarce raw materials                                     |
| 9.                             | AP-Department of Industries                | AP-Department of Industries                      | MSME Registration                                                     |
| 10.                            | AP-Department of Industries                | AP-Department of Industries                      | NOC Acknowledgement from GM, DIC for MSME                             |
| 11.                            | AP-Department of Drug Controller           | AP-Department of Drug Controller                 | License for manufacturing Bulk Drugs and Formulations                 |
| 12.                            | AP - Department of Town & Country Planning | AP - Department of Town & Country Planning       | Permission from TCP for Site and Building                             |
| 13.                            | AP-Commercial Taxes Department             | AP-Commercial Taxes Department                   | VAT Registration                                                      |
| 14.                            | AP-Commercial Taxes Department             | AP-Commercial Taxes Department                   | Central Sales Tax (CST) Registration                                  |
| Odisha (14 Services)           | Odisha (14 Services)                       | Odisha (14 Services)                             | Odisha (14 Services)                                                  |
| S.No                           | S.No                                       | Department Name                                  | Service Name                                                          |
| 1.                             | 1.                                         | Industries Department, Odisha                    | Project Evaluation cum Allotment of Land                              |
| 2.                             | 2.                                         | Directorate of Factories & Boilers, Odisha       | Registration under Boilers Act                                        |
| 3.                             | 3.                                         | Labour Directorate, Odisha                       | Registration under Shops and Establishment Act                        |
| 4.                             | 4.                                         | Labour Directorate, Odisha                       | Registration of Establishment Employing Contract Labour               |
| 5.                             | 5.                                         | Water Resources Department, Odisha               | Permission to draw Water for Industries- Ground Water & Surface Water |
| 6.                             | 6.                                         | Directorate of Factories & Boilers, Odisha       | Approvals of Plan under Factories Act,1948                            |
| 7.                             | 7.                                         | Department of Energy, Odisha                     | New Power Connection                                                  |
| 8.                             | 8.                                         | Housing and Urban Development Department, Odisha | Permission for Site and Building                                      |
| 9.                             | 9.                                         | Directorate of Factories & Boilers, Odisha       | Factories License under Factories Act,1948                            |
| 10.                            | 10.                                        | Housing and Urban Development Department, Odisha | Completion cum Occupancy Certificate                                  |

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| 11.                | 11.                              | Commercial Taxes Organisation, Odisha   | VAT Registration                 | VAT Registration     |
|--------------------|----------------------------------|-----------------------------------------|----------------------------------|----------------------|
| 12.                | 12.                              | Commercial Taxes Organisation, Odisha   | CST Registration                 | CST Registration     |
| 13.                | 13.                              | Odisha State Pollution Control Board    | Consent to Establish             | Consent to Establish |
| 14.                | 14.                              | Odisha State Pollution Control Board    | Consent to Operate               | Consent to Operate   |
| Delhi (2 Services) | Delhi (2 Services)               | Delhi (2 Services)                      | Delhi (2 Services)               | Delhi (2 Services)   |
| S.No.              | Department Name                  | Department Name                         | Department Name                  | Service Name         |
| 1.                 | Factories Department             | Factories Department                    | Factories Department             | Factory Filling      |
| 2.                 | BYPL (BSES Yamuna Power Limited) | BYPL (BSES Yamuna Power Limited)        | BYPL (BSES Yamuna Power Limited) | New Power Connection |

## COMPOSITE APPLICATION FORMS INTEGRATED

| List of joined-up (L3) services   | List of joined-up (L3) services                                                                                                                                                                | List of joined-up (L3) services                  |
|-----------------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------------------------------------------|
| S.No.                             | Service Name                                                                                                                                                                                   | Department /Ministry                             |
| 1.                                | INC-29 with 7 services viz., Name Availability (MCA), Director Identification Number (MCA), Certificate of Incorporation (MCA), PAN (CBDT), TAN (CBDT), Employer registration of EPFO and ESIC | Ministry of Corporate Affairs, CBDT, EPFO & ESIC |
| 2.                                | INC-7 with 5 services viz., Certificate of Incorporation (MCA), PAN (CBDT), TAN (CBDT), Employer registration of EPFO and ESIC,                                                                | Ministry of Corporate Affairs, CBDT, EPFO & ESIC |
| 3.                                | 5 registration services under Employer registration under EPFO and ESIC Act, Contract Labour Act, Building and other Construction Workers Act, and Inter-state Migrant Workmen Act             | Ministry of Labour & Employment                  |

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