EASE OF DOING BUSINESS INITIATIVE THE DAWN OF A NEW CORPORATE INDIA
One click on the website of Ministry of Corporate Affairs and the Honourable Prime Minister of the country greets with a smile. His smile is one of achievements, and that too not a single one but on multiple fronts. Of all these achievements impacting the growth and development of the corporate arena, one that has been grabbing maximum eyeballs is the ‘Ease of doing business’ (EODB). While the first doing Business Report for the year 2003 was published in 2004, the concept caught the fancy of the Indian policy makers only in the last few years. Theoretically, the Ease of Doing Business Index takes into account almost all the regulatory aspects facing the incorporation and operation of a business enterprise. The corporate, the industry and the academia had always complained of lag in the regulatory mechanism leading to delays in the initiation of any business. Issues facing ranged from multiple procedural aspects to variety of regulatory authorities and red tapism even, to name a few. The legal front too looked hazy with plethora of laws demanding n number of procedures to be followed. Each aspect brought with it a long checklist, often unmanageable without the help of a seasoned professional. Not only were the entry procedures or contract formation, beyond the understanding, the closure of a business enterprise, near to impossible. According to the Doing Business Report, 2004, while it took less than six months to go through bankruptcy proceedings in Ireland and Japan, the same procedures would elongate for more than 10 years in Brazil and India. The average time taken to start a business back then ranged between 88 to 90 days. The present day business scenario has come a long way through. Terms like Government Process re-engineering adore the policy structures as far as the business regulatory mechanism is concerned. Bringing down the number of days required to commence a business from 88 to 26 in the 2017 report, the Indian regulatory environment has come a long way through. Presently, Government of India has initiated a further reduction of the time involved in the commencement of business, down to one single day. Establishment of Central Registration Centre for providing speedy incorporation related services in line with global best practices, simplification and rationalisation of Act and Rules, launching the SPICe forms, integration of MCA21 system with CBDT; all of these are some of the pointers of the initiative taken by the GoI towards making the process of commencement and operation of business eASY. In an emerging economy like ours and the dynamic corporate scenario, both inside and across the borders, the role of professionals cannot be sidelined. Various aspects and areas affect the small and medium enterprises as they find operating ground in big cities. From starting a business, involving multi-levelled paperwork, availing credit to making cross-border transactions, and resolving insolvency, the role of professionals has also enhanced immensely. While the EODB initiative may have reduced the time taken at the ‘government’ end by leaps and bounds, the activities entailing a process are here to stay and so is the work for professionals like Company Secretaries; the only difference in situation, then and now, being the fact that the professionals cannot afford to sit back and relax till the time, a document gets a nod or an approval receives a ‘go’ signal. The need of the hour for them is to gear up and be ready to catch with the speed of the policy makers to provide the initiative, the success it deserves. The Doing Business Report of 2017 puts forth some amazing facts in terms of the impact of the Report itself. According to the report, while it was possible in only 41 countries to start business in less than 20 days, back in 2005; the number has more than trebled in 2016, taking the count to 130. Such reports and their analysis reinstate the tripod of BusinessGovernment-Society. Each policy of the government chalked out by its umpteen regulatory authorities and bodies has far reaching impacts, sometimes even on the smallest segment of business and its activity. With start-up culture gaining ground, a lot many people with business ideas are hoping to make it big in the corporate world. A favourable regulatory framework can act as a great catalyst in bringing out the best from such organisations. The combined effort of the corporate, the policy framers and the professionals shall haul the nation into an altogether new era ushering in the growth and development it deserves.
CS (Dr.) Shyam Agrawal, President, ICSI