Ease of Doing business

MAIT is committed to working with the Government to realise its goal of India breaking into the top 50 countries on the World Bank’s index on ‘Ease of Doing Business’ ranking from its current position of 100. For this, it is imperative that the government and the industry work in unison to develop policies that are progressive, cohesive and conducive.

While we work on policy advocacy with the decision makers, it is also MAIT’s endeavour to ensure that the on-ground implementation of these guidelines is efficient and effective. Often execution is a challenge and procedural and process changes are required to be made to increase productivity. On the one hand, those implementing the policy need to be trained to understand its objective and not to give unnecessary importance to minor discrepancies. On the other hand, the industry needs to be guided on making the distinction between an issue of governance (merely a grievance) and a policy issue which hampers Ease of Doing Business.

In order to architect the improvement of Ease of Doing Business index, MAIT recommends the following:

  • Consultation with all stakeholders at the formative stage of legislation: Industry should be conferred with before any policy is put in place so as to gain further insights, seek advice and work around possible issues. Emphasis needs to be made on globally accepted best practices being made mandatory. MAIT recommends that policy drafts and proposed changes are made available in the public domain for a reasonable time period before it is made the body of law.
  • Process simplification: India still reels under the pressure of the license raj and many of our issues are systemic. The manufacturing sector relies heavily on the timely, physical movement of goods, and therefore is the worst affected by regulation. On an average, a manufacturing unit needs to comply with nearly 70 laws and regulations, file 100 returns a year, and comply with multiple inspections. Taxation issues are encumbering the sector with a plethora of pending litigations, wasting precious government resources. MAIT is consistently involving the government and all relevant stakeholders in workshops to help establish a single clearance window for the electronics manufacturing sector.
  • Establishment of a convergence cell: As it stands, with regard to import of IT products, different importers adopt different classifications for the same set of products, owing to no specific classification available in the Customs Tariff. Leaving the decision on customs field officers to use their discretion often leads to delays, especially detrimental to an industry where the time span for obsolesce is limited. MAIT is working with the government to set up a convergence cell, wherein the classification of new IT products should be decided within 30 days of representation.
  • Single, all-inclusive investor policy mandating state-centre coordination: There is a massive disconnect between the centre and state with respect to clarity of sector specific policies and integration of investment incentives. MAIT proposes that a Central Investment Facilitation Window is set up to simplify this process and encourage business continuity.
  • Setting up an ESDM buyer-supplier portal – a platform enabling Make in India: MAIT endorses the setting up of an electronics supply chain portal where buyers and sellers can forge alliances and integrate with one another. The solution will deploy intelligent recommendation engines to facilitate the best-suited supply chain alliances and connect the global and local manufacturing ecosystem.

In addition to the initiatives mentioned above, MAIT counsels that a grievance redressal cell is put in place and that there is increased focus from the government on infrastructure development. Government thrust must be in establishing Coastal Economic Zones (CEZs) that help electronics export clusters flourish and in creating the North-Eastern Gateway to China. MAIT will continue to join hands with the industry and the government to focus on tackling the disability cost, which in turn will bring down infrastructure costs and procedural expenditure. It is our endeavour to steer the sector in the direction of eliminating government concessions altogether and having a positive impact on the economy.

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