msme summit - ease of doing business – the india story - part - 8

Ease of Doing Business – The India story

Part 8

MSME Summit

Role of Government Institutes


India is one of the fastest growing economies in the world. However, India’s position in the ‘Doing Business’ annual reports published by the World Bank continues to be less than favorable. Doing business sheds light on how easy or difficult it is for a local entrepreneur to open and run a small to medium-size business when complying with relevant regulations.

It measures regulations affecting 11 areas across the life of a business : starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, resolving insolvency and labor market regulation.


The latest rankings place India 142nd among 189 economies; lower than BRICS (Brazil, Russia, China and South Africa) counterparts. The performance on each of the key indicators is provided in the chart below.


Yearly movements in rankings can also provide some indication of changes in an economy’s regulatory environment for firms, but they are always relative. Therefore, the table below looks at how far has India come on the areas measured by ‘Doing Business’ both at an absolute and relative level. The relative benchmarks being used include a) Best Performing b) China c) Russian Federation.


2. EXIM Bank: It extends credit facilities for financing at all stages of the export cycle of MSMEs. The Bank’s line of credit (LOC) is available to commercial banks, other financial institutions and overseas entities. This acts as a market entry mechanism for Indian MSMEs MSME exporters and provides a safe mode of nonrecourse financing option. The bank offers buyer’s credit and supplier’s credit for exports on deferred payment terms. These facilities aid MSMEs to offer competitive credit terms to the buyers and are able to explore newer geographical markets


The Government has recently taken some concrete steps to address the issues faced on each of the parameters so as to improve the ‘ease of doing businesses in the country. The Government is targeting to move to the top 50 in the ‘Ease of Doing Business’ rankings in the future.

Role of Government Institutes

4. Small Industries Development Agency (SIDA) : Provides single window service for SSI units


Besides the above, the Government will have to take more initiatives to project India as an attractive investment destination across each of these parameters. The Government would need to undertake reforms to help place the country on an equal footing amongst countries having favorable, liberalized and a transparent business environment. The government’s ‘Make in India’ is one such initiative.

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