Are BJP-ruled states making India more attractive to businesses?

World Bank’s 2017 doing business rankings did not see much improvement in India’s rankings. Indian government was highly disappointed with the outcome saying the rankings do not capture several efforts taken by the government. Moreover, it does not capture the inter-state differences.

The World Bank followed this with State-wise ranking along with DIPP. It shows some interesting changes in the rankings. Above all, the report indicates BJP governed states are doing much better than other party states:

A few days ago, the World Bank in its Ease of Doing Business Index ranked India 130 out of 190 nations in the world. It seems the PM Modi led National Democratic Alliance (NDA) government didn’t take too kindly to the embarrassing findings. A week after the original index was published, the World Bank in a new report has ranked all BJP ruled states as the best places to do business in India.

Two states with governments supportive of the BJP – the newly born Telangana and Andhra Pradesh – top the rankings. At the helm in Andhra Pradesh is Chandrababu Naidu –  a man who has always been considered a darling of big businesses. Telangana is helped by state capital Hyderabad, that fell into its kitty after Andhra Pradesh’s bifurcation in 2014. Hyderabad contributes 95% of Telangana’s service sector revenue, 99% of its information technology exports, houses half the manufacturing hubs and almost half of all Special Economic Zones (SEZs) in the state. It is Naidu who is credited with having made Hyderabad attractive for global businesses.

All other states in the top ten, barring Uttarakhand which occupies the ninth place in the rankings, are ruled by the BJP. Even Uttarakhand’s ranking as an easy place for businesses is probably because of a few industrial towns in the Terai region. The mountains have been in a state of decline and are a no-go for businesses due to lack of supporting infrastructure and logistical challenges of setting up shop in the Himalayas.
So the World Bank’s report, in effect, says that despite India ranking 130 out of 190 nations in the ease of doing business, it has achieved whatever it has only because of the BJP ruled states. The Congress and regional party ruled states seem to be letting businesses and the country down.
Obviously, these rankings are relative. There is a lot of catch up game even in BJP states.
Though, if one looks at things historically one should not be surprised. BJP has always been seen as a party run by business oriented people whereas Congress by social development. BJP leaders have usually understood business issues better than other party leaders. Their state leaders were thwarted by the Central govt which rarely had BJP at helm. Now with two to tango, things are taking a much better shape than earlier years.
The obvious question is whether all these measures lead to welfare of people. creation of stable jobs and so on. We will have to wait for sometime to figure the outcome of these developments…

One Response to “Are BJP-ruled states making India more attractive to businesses?”

  1. Jeffy Says:

    Even Ethiopia is providing much better atmosphere than India to start a business. Ethiopia is one of the world’s poorest nations. Some 29.6 percent of the population lives on less than US$1.25/day. And India is a country with 8% growth rate.

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