Early last month came the inevitable: the good news that The Department for Promotion of Industry and Internal Trade (DPIIT), and the World Bank Group came out with rankings of Business Reforms Action Plans of States (BRAPS), for Ease of Doing Business. And the inevitable bad news: Goa plummeting to the 24th position (out of 29).
This year they judged States not only from their own evidences of reforms, they also sought corroboration from “end-users”, viz Industry Bodies on results they received. And I think this 2-tier ranking is ideal.
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Twelve areas on which evidences on reforms were instituted, were uploaded by States and again on which users would be asked what results they finally got. The areas were: 1. Access to Information and Transparency; 2. Single Window System; 3. Land administration and transfer of Land and Property; 4. Land availability and allotment; 5. Environment Registration; 6. Construction Permits; 7. Labour Regulations; 8. Obtaining Utility Permits; 9. Paying Taxes; 10. Inspection; 11. Contract Enforcement and 12. Sector Specific – ease of getting licenses basically, like a bar-license etc. It’s interesting!
The Rankings: The States that have been consistently sharing the 2 top-slots again are Andhra (1st) and Telangana (3rd) with 100% claims of instituting reforms and users giving them 98.3%!
States that have zoomed up are UP in the 2nd slot – (overtaking even Telangana) up from 12th last year, Himachal 7th – up from 16th; Delhi 12th up from 23rdand Lakshadweep 15th from 29th! I honestly think our esteemed leaders could do well to study these States – how exactly they did what they did? What is noticeable across the board was that, the States’ evidences and the users’ perceptions nearly converged.
States that have slid miserably were, Gujarat from 5th they dropped to 10th, Haryana from 3rd, they dropped to 16th and of course, Goa from 19th, we dropped to 24 (not that 19th itself was something to write home about!) Now again – in mostly all 3, there are marked differences between what the State Governments would have us believe and what we ATUALLY find on ground zero! There’s a marked disconnect – and that’s not healthy for Industry to thrive in that State! For example, last year, the Goa Governments’ evidences show fantastic work in Inspection reforms, Labour Regulations, Availability of land whereas in all of these three areas users do not perceive any results – (mostly a naught)! Again, just to understand, the State Governments’ evidences totalled last year to around 62%, (not a good score at all) users however saw the performances as only 52% and the overall stood at 57%. Reforms are reforms, only if they show up results!
My take: I’m sure the state governments would have by now clarity with their “customers” where-all to improve, but I would have as usual, a different perspective to this! And I’m of the firm belief that each State has to prioritise. Resources are neither unending nor do they come free – particularly in the post-pandemic scenario.This is an age of specialisation, in areas of inherent core-competencies which a State has. I think Andhra and Telangana have consciously prioritised in new-economy industries like IT & ITES, BPOs, transcripts, financial services etc. Tamil Nadu on manufacturing, Maharashtra on manufacturing and financial services, MP, Jharkhand, Chhattisgarh, Himachal and Rajasthan on tourism, culture and heritage (apart from the old economy’s mining) – between themselves they rank 4th to 8th in the all-India rankings! In my view Goa should concentrate on ONLY SIX areas whilst planning its Business Reforms! Not something here, something there, little of IT, little of logistics, little of entertainment, at the end nobody really knows for sure which way we’re headed.
My 6 areas for Goa are: 1) Tourism – particularly, Hinterland, Heritage and Eco; 2) Pharma; 3) Agriculture; 4) Energy – Wind and Solar; 5) Waterways and most importantly 6) Size of Government! I’m not sure for example, where the expensive tourism master-plan is gathering layers of dust, Pharma should be a thrust area – we have core competence in this area already, agriculture is nearly a forgotten subject where as per the Governments’ last published data, actual expenditures are coming down, so are cropped area, food production and yields. Include fisheries, poultry, vegetables, horticulture, floriculture, and olericulture. All this with organic farms and drip irrigation followed by food-processing and Exports as well. Try out coffee and we are already strong in spices. With the new agri-policies in place, I expect it’s THE “industry” for Goa. Wind and Solar Energy and Waterways are the areas of tomorrow – gear up today! My special emphasis is on the last point. The Size of Government: We employ 61,256 persons (Government data), if I add the State PSUs and autonomous bodies the figure could be significantly more. Our ratio of Government employees to population works out to 4.2% against an all India average of 1.6%! Why should approvals pass thru layers and layers of people? With automation and reforms claimed, we should set targets for say, ⅓ the numbers. And in conclusion: Once priorities are set, designing processes becomes so much easier – I think that’s the key to improve.
Eyes on the industry first, see what it needs then design the processes – rather than the other side up! Goethe wasn’t privy to our DPIIT-WB rankings – but there seems no escape from “Things which matter most!”.
(Binayak Datta is a Finance Professional)
