Doing business in Nepal easier than in India

Doing business in Nepal easier than in India
eKantipur.com, 26-Sep-2007

Despite prolonged political transition and internal upheavals, it is easier to do business in Nepal than in India, says a report from the World Bank.

The report - Doing Business 2008 - launched on Wednesday has ranked Nepal at the 111th position in terms of ease of doing business, ahead of India. The report which rated 178 countries across the world on trade, taxation, business start-up costs, labor laws and legal procedures has ranked India at the 120th position.

The report is the fifth in an annual report series issued by the World Bank and its private lending arm, the International Finance Corporation (IFC).

According to the report, Nepal ranked 60th in starting a business. It takes 31 days to start a business in Nepal and investors need to fulfill just seven procedures to start the business, whereas in India, it takes 33 days and investors need to complete 13 procedures, says the report.

In terms of registering property, Nepal has been ranked 25th while on protecting investors it has been ranked 64th.

However, workers and cross border trading stands as the two biggest impediments in doing business in Nepal, says the report. On those two issues, the report has ranked Nepal in 155th and 151st respectively.

The report further says that South Asia has picked up pace in regulatory reforms over the past year to become the second-fastest reforming region in the world, on par with the speed of reforms in the countries of the Organization for Economic Co-operation and Development (OECD).

Last year South Asia was ranked lowest on the rate of reform. But this year two-third of its countries saw at least one reform, it says.

According to the report, India is the top reformer worldwide in trading across borders while Bhutan and Sri Lanka are the other top reformers in South Asia this year.

Bhutan introduced the country's first fundamental labor protection law and Sri Lanka made it easier to start a business and to trade across borders.

Singapore, for the second year running, tops the aggregate ranking on the ease of doing business. The top-ranking countries in South Asia are Maldives (60) and Pakistan (76). India improved its ranking from last year's 132nd and jumped 12 places, achieving a bigger gain than China, which rose by nine places to 83rd.

The report states that India is now setting the standard for reforms in South Asia, with an explicit policy objective to become a leading business-friendly economy.

Besides making it easier to trade across borders, India increased access to credit by expanding credit bureau coverage to individuals as well as businesses, it says. It also introduced an electronic registry for security rights granted by companies.