With the goal of making India a preferred business destination and global manufacturing hub, Pahle India Foundation is laser-focused on policy innovation to build an investor-friendly business ecosystem. Against the backdrop of pandemic- induced supply chain shocks and changing geopolitical realities, businesses around the world are increasingly adopting a ‘China plus one’ diversification strategy. India must seize this opportunity to establish itself as a viable ‘plus one.’ These aspirations cannot be achieved with a hostile regulatory system in place, weighing down business growth. In the words of Shri Piyush Goyal, Minister of Commerce and Industry, the need of the hour is to shift away from red-tapism towards laying the red carpet for businesses.
The Indian manufacturing sector has long faced difficulties in scaling up and achieving global competitiveness due to the lasting legacy of the License Raj, despite the nation’s sizeable labour force and internal market. The regulatory environment represents a long-standing pain point for businesses, with its excessive volume, complexity and stringency. An intricate and opaque web of compliances, punishing waiting periods for approvals, overall regulatory uncertainty, and poor corporate governance practices are all factors that hurt investor confidence and prevent the fulfilment of India’s manufacturing potential.
The Government of India has already undertaken substantial initiatives to improve ease of doing business. Global investors and manufacturing companies have welcomed recent policies, including the Phased Manufacturing Programme (PMP), Production Linked Incentive (PLI) schemes, the ‘Make in India’ initiative, PM Gati Shakti National Master Plan, National Logistics Policy, National Single Window System (NSWS), etc. Owing to such reforms, India ranked at 63 in the World Bank’s Doing Business Report 2020, a significant rise from rank 142 in 2014. The Business Reforms Action Plan (BRAP) has emulated this ranking at the pan-India level, encouraging states to compete for Top Achiever status by implementing business- friendly reforms. With the Department for Promotion of Industry and Internal Trade (DPIIT) as a nodal point, states have take up a four-pronged mission: to simplify compliance procedures, rationalise redundant laws, digitise forms and records, and decriminalise minor technical or procedural defaults.
To support ongoing nationwide efforts to build a conducive business ecosystem, Pahle India Foundation is undertaking a variety of vital policy initiatives. These include carrying out a regulatory impact assessment of recent compliance rationalisation efforts, assessing the net impact of Indian e-commerce on employment and consumer welfare, and identifying constraints to creating globally competitive and large-scale manufacturing capacity in India.