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Gujarat, Delhi most investment-friendly; Bihar, Jharkhand worst

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Investment Friendly State

Gujarat and Delhi are India’s most investment-friendly states. Bihar and Jharkhand are the worst. Andhra Pradesh and Tamil Nadu are the most corrupt states for doing business. West Bengal is the most difficult for land acquisition, environmental clearances and approvals.

These are the findings of the recent “The NCAER State Investment Potential Index”, released by the National Council for Applied Economic Research (NCAER), which evolved an index to grade states on five main issues: Labour, infrastructure, economic climate, political stability and governance, and perceptions of a good business climate.

The report contains two types of rankings: First, N-SIPI 21, an index that ranks 21 states on the five issues, including through industry surveys; second, N-SIPI 30 which includes all states – including nine not covered by industry surveys – and are based on four issues, excluding perception.

The data reveals that Gujarat tops the N-SIPI 21 index, followed by Delhi and Tamil Nadu, while Delhi, Gujarat and Tamil Nadu top the N-SIPI 30 index.

Bihar and Jharkhand fall in the bottom five states in both rankings.

In May 2016, the Department of Industrial Policy and Promotion (DIPP) listed how Delhi’s ruling Aam Aadmi Party was making it easier to do business, adding that the Centre was working with Delhi and Maharashtra to propel India’s rank into the Top 50 in global ease-of-doing-business rankings.

Corruption is the biggest issue faced by businesses, getting approvals comes second

A whopping 79 per cent of industry respondents said corruption was a major issue, followed by approvals before starting business (72.1 per cent) and getting environmental clearances (66.7 per cent).

Earlier this year, India was ranked 76 out of 168 countries in Transparency International’s Corruption Perception Index 2015.

In a recent editorial on crony capitalism, however, The Economist said: “Encouragingly, India seems to be cleaning up its act. In 2008 crony wealth reached 18 per cent of GDP, putting it on a par with Russia. Today it stands at three per cent, a level similar to Australia. The pin-ups of Indian capitalism are no longer the pampered scions of its business dynasties, but the hungry founders of Flipkart, an e-commerce firm.”

Bengal worst in land acquisition, environmental clearances and getting approvals

Up to 82 per cent of respondents reported that they had problems in acquiring land in West Bengal, whereas only five per cent reported having any problem in Uttarakhand.

More than half of respondents (54.3 per cent) reported that environmental clearances were a “severe” problem in West Bengal; 11.4 per cent said it was not a problem.

It was easiest to get such clearances in Himachal Pradesh, with no more than 2.5 per cent of respondents reporting it as a “severe” problem, while 87.5 per cent said it was not a problem at all.

In terms of getting approvals for business, West Bengal was, again, the worst, with 68.6 per cent reporting a “severe” problem; 5.7 per cent said it was not a problem. Himachal Pradesh performed the best with no respondent (0 per cent) reporting approval problems.

Andhra Pradesh and Tamil Nadu report most corruption issues

In Andhra Pradesh, 74.3 per cent of respondents reported corruption as a “severe” problem; no one (0 per cent) in Himachal Pradesh reported corruption as a “severe” issue.

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Analysis

Actual sugarcane FRP hike is Rs 6, not 20: Agri activists

The government has approved a premium of Rs 2.75 per quintal for each 0.1 per cent increase in the recovery over and above 10 per cent.

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New Delhi, July 18 (IANS) The government’s decision on Wednesday to increase the Fair and Remunerative Price (FRP) for sugarcane for 2018-19 (October-September) season by Rs 20 to Rs 275 for a quintal comes with a rider that the new rate will be applicable only when the recovery rate is 10 per cent.

The recovery rate — of sugar from sugarcane — was 9.5 per cent when the government had fixed the FRP of Rs 255 for a quintal in 2017-18.

If the recovery rate of 9.5 per cent is considered for 2018-19, the farmers will get only Rs 261.25, which is a hike of roughly Rs 6.25, on year-on-year basis.

According to Union Food Minister Ram Vilas Paswan, 295 mills of the total 550-odd mills in the country have reported recovery rate of over 10 per cent.

“Earlier, the recovery rate was 9.5 per cent. But it is increasing now. There are 295 mills which have reported over 10 per cent recovery rate, 82 have between 9.5 and 10 per cent, while there are only 127 mills that have below 10 per cent recovery rate. As the majority is of 10 per cent, we have gone with it (while fixing the FRP),” Paswan told reporters here.

The average national recovery rate is 10.51 per cent, while it is 10.20 per cent and 11.47 per cent in major sugar producing states of Uttar Pradesh and Maharashtra, respectively, he said.

However, agriculture activists called the hike in the FRP “shameful”, saying the actual hike would be below 3 per cent.

“It’s like peanuts. It is not even 3 per cent since expenses on electricity, labour and fertlizer have gone up significantly. The hike should have been done rationally,” said V.M. Singh, president of Rashtriya Kisan Majdoor Party.

He said the remuneration at 10 per cent recovery rate in 2017-18 was Rs 268, which means the actual hike is only of Rs 7 this year.

There are about five crore sugarcane farmers in the country and about five lakh workers are directly employed in sugar mills.

The total remittance to sugarcane farmers by the millers would be over Rs 83,000 crore.

The government has approved a premium of Rs 2.75 per quintal for each 0.1 per cent increase in the recovery over and above 10 per cent.

According to the government, the production cost of sugarcane for 2018-19 is pegged at Rs 155 per quintal, so the FRP of Rs 275 per quintal would provide a return of 77.42 per cent.

The FRP is determined on the basis of recommendations of the Commission for Agricultural Costs and Prices (CACP).

Paswan said there will not be any reduction in case recovery rate goes below 9.5 per cent and farmers will get Rs 261.25 per quintal.

As per the Food Ministry’s figures, the cane arrears, which stood at Rs 14,538 crore at FRP (Rs 23,232 crore at state advisory price – SAP) on May 21, has come down to Rs 9,319 crore (Rs 17,824 at SAP) following the various steps taken by the government in May including the Rs 7,000-crore package.

“Our top priority is farmers. To ensure that millers can pay farmers their dues, we give them such facilities,” Paswan said.

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Business

Chidambaram slams government over ‘economic mismanagement’

“After 5-month-high inflation and 7-month-low industrial growth comes the news of soaring trade deficit.”

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New Delhi, July 14 : Senior Congress leader P. Chidambaram on Friday slammed the government over its poor management of economy, saying inflation is at five-month high, industrial growth at five-month low and the trade deficit has soared.

Chidambaram, a former Finance Minister, said in tweets that exports were lower in June compared to May and the imports higher.

He said despite the higher trade deficit, the government would continue to say that all is well.

“After 5-month-high inflation and 7-month-low industrial growth comes the news of soaring trade deficit.”

“June exports lower than May. June imports higher than May. June trade deficit higher by $2 billion. But the government will say all is well,” he said.

Chidambaram said the Congress leaders had estimated that demonetisation would lead to a cut in growth rate by 1.5 per cent and the outgoing Chief Economic Advisor Arvind Subramanian has said that purging high currency notes in November 2016 led to a definite slowing down of economy.

The official data showed on Thursday that retail inflation in India touched the 5 per cent-mark in June, compared to 4.87 per cent in May, even as industrial output in May grew at 3.2 per cent compared to the same month last year but declined as compared to rise of 4.9 per cent in April mainly on account of a decline in manufacturing.

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Online hiring for government jobs fell 20% in June: Report

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New Delhi, July 5: Online recruitment activity for government services, including public sector enterprises and defence sector, declined by 20 per cent in June on a year-on-year basis, a monster.com report said here on Thursday.

Overall online recruitment in June 2018 fell by three per cent on a year-on-year basis and eight per cent compared with May 2018, the Monster Employment Index for June 2018 said.

“Printing and packaging sector witnessed the steepest decline — 27 per cent year-on-year basis and 15 per cent month-on-month basis,” the report said.

In the agriculture-based industries, online hiring declined by 19 per cent in June 2018, compared with June 2017.

However, the production and manufacturing segment registered a 49 per cent rise in online recruitment. Home appliances segment registered a 27 per cent fall.

“Production and manufacturing (up 49 per cent) led all monitored industry sectors by the way of long-term growth for the third month in succession,” the report said.

IANS

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