A fierce competition has broken out among states on the ease of doing business rankings, with states contesting every point, while some have even hired top consultants to keep tabs on the entire process. States want these consultants, including PwC, EY and KPMG, to not just help them with their own reforms, but also assess the business reforms of those states which are ranked above them, and point out possible discrepancies.

The Department of Industrial Policy and Promotion (DIPP) has now organized a video conference with each state to seek clarifications and give them a platform to voice their concerns. Each state has been given a 30-minute slot to make its case. As of now, the rankings which are getting changed almost daily, have Chhattisgarh and Gujarat in the lead, followed by Rajasthan, Jharkhand and Madhya Pradesh.

This is vastly different from the ranking on the last day of submission of documents when Uttarakhand had emerged as the surprise leader followed by Telangana. Gujarat was then at the 11th place while Maharashtra and Karnataka at 14 and 17, respectively.

With government operating a dashboard where all evidence of reforms done by states gets uploaded as soon as they are verified, the race to the final is for all to see. This has caused much resentment among states that have slipped. Delhi, for instance, is currently at 20, down from 15 last year. The AAP-ruled state has now hired KPMG to oversee its process.

“It would have been better if instead of this ranking system which puts significant pressure on states, they could be divided into some quadrants. Some could be mature, other emerging states,” said Gaurav Taneja, National Leader, government practice, EY. More than half the submissions made by the states have been verified and DIPP is hoping to wrap up the process soon to announce this year’s rankings. DIPP had extended the date to seek clarifications from the states till August-end.

The last date to submit response to the 340 action points was July 7. While DIPP itself has questioned the claims of states on various reforms, states are not just defending their submissions but also raising queries on competing states.

For instance Telangana, which introduced certain reforms at Hyderabad HC, had not taken it too kindly when Andhra too got points for the same since they shared the same HC.

Government officials said it is the end result that will get the points to the states and in such cases the work of one will benefit two. Government had even received suggestions that it should simply announce the final results instead of updating the list real time to avoid states questioning every single move by the government.

Source: Economic Times