What India’s jump in ease of biz rankings means for realty?
For all the right reasons, the World Bank’s Doing Business 2018 report was the toast of the country, and the markets reacted with positivity. Now that the initial euphoria has died down, it is appropriate to delve deeper and look for potential learnings in the report.
As a country, we should analyze the WB report not only from the ranking perspective but also the DTF scoring point of view. DTF stands for ‘distance from the frontier’ with scores ranging from 0-100 (where 100 is the strongest or front-runner economy). Also, to gauge the ruling Government’s performance since election, it is appropriate to compare the rankings of 2018 and 2014. These three indicators reveal a lot more than what has been discussed so far.
This analysis does not attempt to downplay the progress made by the country and the fact that India has commenced in the direction of the Government’s goal to attain a ranking under 50. However, from point of view of serious investors and analysts, it is important to try and figure out how soon India will reach the top 50, and how other countries are faring.
India has made good progress vis-à-vis areas that still need improvements on the journey of going from the 100th to the 50th ranking nation. From the perspective of real estate, the five indicators that have a high impact on the sector are registering a property, dealing with construction permits, enforcing contracts, and resolving insolvency.