In a recent report released by the Observer Research Foundation (ORF), Jeld for Doing Business (bit.ly/3vFWUWX), co-authored by Gautam Chikarmane, Vice President of ORF and Rishi Agarwal, Co-Founder and CEO of Avantis RegTech . An astounding 69,233 unique compliances have been listed, of which 26,134 clauses carry imprisonment as a punishment for non-compliance. Of the states with the highest number of compliance requests, five have the highest number of imprisonment clauses—Gujarat (1,469), Punjab (1,273), Maharashtra (1,210), Karnataka (1,175) and Tamil Nadu (1,043). It is utterly disheartening and depressing that despite such a stringent compliance regime, with so many rules, regulations and stringent clauses, the real crooks seem to be escaping the long arm of the law time and again.
The Prime Minister of India, Narendra Modi is fully aware of these obstacles in the development of India. On 21 April, he used the occasion of 15th Civil Services Day to not only present awards for excellence in public administration, but also to spread the message that our sordid steel structure, bureaucracy coupled with our complex administrative system Presenting the image of a country. Great Challenge to India’s Progress Recalling his early experience after being announced as the Bharatiya Janata Party’s prime ministerial candidate in 2013, Modi said, “I was called by the business community in Delhi when my party had first announced me as the prime ministerial candidate in 2013. I give a speech, 4-6 months before the 2014 general election. When they asked me what I would do, I said I would every I will abolish one law on day one, I will not make a new one. So they were shocked! And I abolished 1,500 laws in the first five years.”
Speaking no words, Modi said, “Now you see that there were hundreds of such laws, I believe they have become a burden for the citizens of the country. Tell me, friends, we are like these.” Why live with laws? Even today I am of the opinion that with so many laws which are lying idle, why don’t you take some initiative and end them? Get the country out of this trap.”
With Cabinet Secretary Rajiv Gauba sharing the stage, Modi continued to move towards an endless set of compliances demanding Indian citizens: “Similarly, we keep demanding all kinds of compliances from citizens. I told the cabinet secretary that as long as we try to work [through our software and technology outsourcing] For the rest of the world, you must take responsibility, free the country from compliance, free the citizens. 75 years of independence, why are you trapping citizens in this trap? And six people will be sitting in an office, every table person will know, but still ask separately, don’t take it from the side!”
Let us return to the prison to do business, the material of which was collected over the past seven years by TeamLease and RegTech. The monograph classifies its findings under seven broad categories ranging from labor, finance and taxation, environment, health and safety to secretarial, commercial, industry-specific and general areas. The regulator also bars additional profit-oriented and non-profit institutions. Not only is it difficult to start a business or institution in India, but it is even more difficult to close it. As TeamLease President Manish Sabharwal puts it, “The excessive criminalization of India’s employer compliance universe breeds corruption, stifles formal employment and poisons justice.”
The report is full of recommendations, including rationalizing business rules and regulations, preventing criminal penalties, and broad-based policy reform. Regulation and restructuring of the country’s compliance mechanism will not only improve the general business environment in India, but will also protect the dignity of wealth-creators, innovators, entrepreneurs and business leaders.
The Prime Minister’s clarion call to civil servants provides an excellent opportunity for the Central Government as well as the various States of the Union, their various Ministries and Departments and the entire country to initiate a comprehensive reform process that will take India forward . New heights of prosperity and happiness.
This is the first of a series of ‘Barriers to Development’, highlighting the laws and regulations that hold India behind. These are personal views of the author.
Makarand R. Paranjpe is a writer and academic.