Indian companies continue to pay a high cost for compliance, report says

There is also a perception that the more material you carry, the better you would perform in the exam. But that is not true since students do not have time for extensive reading during the test. (Representative image)

Indian companies continue to have a high burden of compliance, with the average firm expected to meet 25,537 central compliances. If a company operates in all states, it has to follow 69,233 compliances, Mint reported citing data from consultancy TeamLease.

In states such as Maharashtra (3,657 compliances) and Gujarat (3,048), where industrial activity is high, the burden of compliance is even greater, the data said.

Also read: India climbs to 34th spot in Global Real Estate Transparency Index as regulatory reforms show results"Ease of doing business can't actualise till we simplify our compliance regime. While we are worried about the lack of formalisation, cost of compliance is disproportionately high, and it takes disproportionate bandwidth, essentially taking away attention of Indian enterprises from their core job," said Rituparna Chakraborty, co-founder and senior vice-president at Team Lease said, as quoted by the paper.

India's Ease of Doing Business Ranking has improved significantly from 142 in 2014 to 63 in 2019. But there are challenges related to implementation and interpretation of the laws, Amit Maheshwari, partner at Ashok Maheshwary & Associates LLP told Mint.

"There is a definite improvement in ease of doing business; however, implementation of law remains a challenge. The conflicting interpretation of laws further add to challenges for businesses and Indian companies," Maheshwari said.

Commerce minister Piyush Goyal had in June discussed ways to improve the ranking with officials from the Department for Promotion of Industry and Internal Trade (DPIIT).

NITI Aayog CEO Amitabh Kant said in December 2019 that the goal is to push India into the top 50 countries on the Ease of Doing Business Ranking next year.