Swaminathan A Aiyar in “The Times of India” article writes how doing business in India is very tough as well as a very tedious process, he makes some comparison with China and Hong Kong. Here are some of the interesting facts:
For enforcement of contract, which is fundamental to business, India ranks 173rd. Enforcement requires 56 procedures over 1,420 days in India, 31 procedures over 292 days in China, 16 procedures over 211 days in Hong Kong.
The above point is surprising, since for any kind of business enforcing the contract is important. Requiring almost 4 years for enforcement can be lethal for small businesses, and is suited only for large business which have that much money and time to play with.
Debtors recover just 13% of their claims in India, 31.5% in China and 78.9% in Hong Kong.
WoW! Hong Kong is just great, 79% recovery of debts is huge, I wonder how they accomplish it. Businesses in India struggle here too, with just 13% recovery of claims, its just very very tough to run businesses.
Winding up a business takes a phenomenal 10 years in India, 2.42 years in China and 1.08 years in Hong Kong.
Well if you thought you had enough and want to close down your business, it’s not that fast a process, it would take you 10 years!! to wind up a business. The above points clearly show that Hong Kong is very effective and conducive environment for doing business. I am sure that the situation in India will improve, but how long it will take is the million rupee question.
Many more facts and figures are available at The Times of India page.
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