What ease of doing business?

For me, ease of doing business should apply to sellers on the street as much as business houses picking up our public assets for a pittance. Representation pic

The ease of doing business index is a sign of how obsessed we all are with the idea of making money. It isn't something the world even pretended to need before 2002, when a paper titled ‘The Regulation of Entry' was published by a group of economists in America. Since then, however, it routinely attracts a lot more attention than less important reports on hunger or poverty, so I spent a bit of time looking at how India has been faring on this front.

Apparently, we have improved our ranking by 79 positions over the past five years. I asked a few friends who happen to be businessmen about what this meant, and if these figures really reflected how they go about their daily lives. There was much shrugging of shoulders, which I expected because ground realities are almost always radically different from what any economist sitting in the West can say about another country. A few consultancy firms laughed off these rankings too, pointing out that companies in India continued to face all kinds of obstacles, be it with the nightmarish processes involved in obtaining a permit or inordinate delays in payments for public procurement.

Governments like to use words like ‘business climate' when it suits them, because this serves as a catchall term that doesn't really explain how or why our lives are being improved by all this ease of doing business. They also like reports like these because it allows them to spend a little more time on public relations and gives them something to print on taxpayer-funded political advertisements. Ultimately, these are statistics that are tweaked for political benefit and little else.

For me, ease of doing business should apply to sellers on the street as much as business houses picking up our public assets for a pittance.

The ease of doing business index measures everything from starting a business and dealing with construction permits, to getting electricity, registering property, getting credit, protecting minority investors, paying taxes, trading across borders, enforcing contracts, and resolving insolvency. None of these factors hold up well under scrutiny for anyone who isn't affiliated to a long-established conglomerate. It's why some firms can dip their fingers into as many pies as possible with consummate ease, while millions find it hard to get a lightbulb to flicker in their rental spaces.

We all know what it takes to get a permit for anything, and how the less fortunate among us have to run through hoops when it comes to getting credit. We are also painfully aware of how banks will hound us for an EMI of a few thousand, then sit back and do nothing while private investors abscond with millions. If a country's ease of doing business is to be measured, the index should also look at who this applies to and who it leaves out. Without that information, is any report even worth the paper it is printed on?

In an ideal world, the people creating this report should involve the common Indian trying to make a living, not just conglomerates armed with batteries of accountants and lawyers. The ease of doing business should also take corruption into account, because it is the elephant in our room that no one wants to address. Try registering a property without the involvement of a bribe, and the hollowness of so many of these claims becomes glaringly obvious.

I have no interest in doing business in India because I have long acknowledged my inability to cope. I knew I wouldn't have the thick skin required, and the years I spent as a journalist would make it hard for me to look the other way while making a deal. Little happens in our country without the proverbial mutual scratching of backs, and any report that ignores that reality is a deeply flawed one.

What we should pay more attention to are reports showing us what our government doesn't do: how it fails on everything from malnutrition to infrastructure, climate change to accountability. What we need are simpler explanations for why we keep paying more for everything and get less in return. The taxes we hand over are investments into our collective future, on which we get no say, and on which we get dismal returns. That is the kind of report I would love to read.

I don't care about our businessmen because they will be fine. They always have been and will continue to thrive long after the rest of us declare bankruptcy.

When he isn't ranting about all things Mumbai, Lindsay Pereira can be almost sweet. He tweets @lindsaypereira
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The views expressed in this column are the individual's and don't represent those of the paper.