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Time of India
02-05-2025
- Business
- Time of India
Deregulation at what cost?
Yadul Krishna is a policy economist and a legal fellow at Governance Innovation Labs. As the Parliamentary Secretary to a Rajya Sabha MP, he drafted "The Bhagat Singh National Urban Employment Guarantee Bill, 2022," successfully introduced in the 2022 Monsoon Session of Indian Parliament. He previously worked as a finance professional in an investment services company and was briefly a columnist with the British Herald. Krishna's writings on the economy and governance have appeared across the globe, with multiple translations into other languages and have been referenced in research papers and newspaper editorials. An alumnus of SRCC, he is currently pursuing law at the Faculty of Law, University of Delhi. He tweets @Yadul_Krishna LESS ... MORE The introduction of the Deregulation Commission, staffed by technocrats and policy consultants with little to no mandate for public consultation, echoes a problematic shift in governance—one that privileges executive discretion over democratic process. On April 25, 2025, the Union Government announced the formation of a Deregulation Commission under the broader framework of the Jan Vishwas 2.0 initiative. This body is tasked with identifying and eliminating redundant or outdated compliance obligations in sectors including energy, telecom, logistics, and manufacturing. The aim, the government claims, is to streamline administrative processes, reduce friction for businesses, and invigorate economic growth by eliminating the burdens of regulatory red tape. At first glance, the move appears to carry the promise of economic efficiency. However, its long-term implications raise important questions about the role of the state, the future of federalism, and the protection of public interest in India's developmental trajectory. The Rhetoric of Reform and the Reality of Deregulation The stated rationale behind the Deregulation Commission is not unfamiliar. Cumbersome regulations, time-consuming permits, and overlapping jurisdictions have long been cited as deterrents to enterprise, particularly for small and medium-sized businesses. In its final 2020 edition, the World Bank's Doing Business report placed India at 63rd among 190 economies, identifying weaknesses in areas such as contract enforcement and dealing with construction permits. However, the report was later scrapped by the Bank itself due to data irregularities and political interference, revealing the perils of relying on efficiency indices without interrogating their underlying assumptions. While regulatory reform is indeed necessary, deregulation cannot be synonymous with indiscriminate dismantling. The existing compliance framework, though flawed, serves vital public functions: it regulates emissions, enforces minimum wages, protects workplace safety, ensures transparency in financial transactions, and governs public procurement. If these checks are weakened in the name of agility, the result will not be reform but a weakening of the state's protective capacity. Environmental concerns are particularly germane. Since the 2020 draft Environment Impact Assessment (EIA) notification, successive governments have attempted to dilute environmental safeguards in the name of 'ease of doing business.' The Deregulation Commission risks accelerating this trend by bypassing established procedures for public consultation and environmental scrutiny, effectively excluding communities most affected by extractive development—Adivasi populations, agrarian villages, and forest-dependent households. Centralisation and the Federal Imbalance One of the less discussed yet crucial dimensions of the deregulation project is its centralising tendency. The Commission operates as a central body, without any constitutional mandate to consult states or engage sub-national governments in its agenda-setting. This is troubling in a federal polity like India, where states have historically tailored compliance frameworks to their own socio-economic contexts. Kerala's robust environmental due diligence practices or Tamil Nadu's historically active labour welfare boards cannot be collapsed into a one-size-fits-all model that privileges uniformity over responsiveness. The Union's expanding executive footprint in economic governance—whether through centrally framed labour codes, direct benefit transfer systems with limited state discretion, or now, deregulation templates—has effectively diluted the constitutional balance envisioned in the Seventh Schedule. Without formal mechanisms for intergovernmental consultation, the Commission could reduce states to administrative extensions rather than co-equal partners in economic reform. Disproportionate Gains, Uneven Burdens The promise of deregulation rests on the hope that reduced compliance burdens will attract greater investment, stimulate job creation, and improve India's global competitiveness. Yet empirical evidence for such trickle-down benefits remains sparse. A 2023 Reserve Bank of India bulletin noted that while India had seen an uptick in FDI inflows, employment elasticity in the organised sector remained weak. CMIE's data from March 2024 showed that over 400 million Indians continue to work in the informal sector, with scant access to social protection . What this indicates is that deregulation, in practice, often benefits capital more than labour. In the last five years, corporate tax collections have declined even as incentives have multiplied. While the 2023-24 Union Budget offered ₹1.09 lakh crore in revenue foregone through corporate exemptions , key welfare schemes like MGNREGA saw allocations slashed from ₹73,000 crore in FY22 to ₹60,000 crore in FY23 . PM Awas Yojana (Urban), despite a growing housing deficit, was capped at ₹25,103 crore in the same year . These trends reflect a narrowing fiscal imagination—one that underwrites corporate certainty while shrinking the public provisioning net for the majority. Moreover, labour law 'reforms' introduced since 2020 have increasingly tilted the balance of power away from workers. The Industrial Relations Code allows for retrenchment of up to 300 workers without state permission, effectively legalising precarious employment. In such a policy environment, further deregulation without parallel institutional strengthening could entrench inequalities rather than mitigate them. Reform That Deepens Democracy India does need regulatory reform. Many of its laws date back to colonial times or reflect outdated economic models. But the process of reform must itself be democratic, consultative, and transparent. The Deregulation Commission, as currently constituted, is neither accountable to Parliament nor required to engage with civil society, labour unions, consumer rights bodies, or ecological experts. This absence of participatory architecture undermines the legitimacy of its mandate. What is required is not the wholesale dismantling of the state's regulatory role, but a reimagining of it. A democratic reform process would begin by auditing existing compliance burdens, disaggregated by sector and region. It would then involve state governments and key stakeholder groups in shaping sector-specific reforms that balance growth with sustainability and inclusion. Reform, in other words, must be dialogic, not technocratic. India is at a moment when the language of governance is being rewritten—away from participation and towards efficiency, from social protection towards deregulation, and from federalism towards executive centralism. While these shifts may deliver short-term gains on paper, they risk undermining the constitutional ethos that frames economic policy not just as a function of growth but as a vehicle for justice and equity. Facebook Twitter Linkedin Email Disclaimer Views expressed above are the author's own.
Economic Times
27-04-2025
- Business
- Economic Times
CII calls for overhaul of National Judicial Data Grid
The Confederation of Indian Industry wants changes to the National Judicial Data Grid. This is to speed up how disputes are resolved. It hopes to improve contract enforcement in India. The CII suggests more specific dispute categories. They also want uniform data reporting across courts. This can help identify delays and improve the judicial process. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads New Delhi: The Confederation of Indian Industry ( CII ) has called for revamping the National Judicial Data Grid (NJDG) to enable quicker dispute resolution which will improve India's contract enforcement capabilities, a parameter that has been a consistent drag on the ease of doing business in the World Bank's 2020 Doing Business report placed India at 163 out of 190 countries for contract enforcement, while its overall ranking was NJDG was launched in 2015 under the e-Courts Mission Mode Project to track, manage and reduce case pendency across India's judicial system. India Inc has recommended changes such as categorising disputes with more specificity, classifying disputes comprehensively and ensuring more courts across the country are onboard the CII said a more specific categorisation of disputes with details such as statutes or laws under which a case has been registered reflected on the grid can "help in identifying the most as well as least invoked statutes, assess average resolution times of specific categories, pinpoint specific delays and learn from the good practices".The industry body pitched for a more uniform framework for data reporting of cases across courts, pointing out discrepancies in the classification of cases by the grid and courts."For example, the Delhi High Court classifies cases under about 50 distinct categories whereas NJDG reflects a much lesser number of categories. Detailed and standardized reporting structure on NJDG would enhance comparability, improve tracking of pendency trends, and facilitate customized policy interventions," the CII highlighted that rapid growth and urbanisation had driven up the number of disputes, leading to a piling up of cases before the courts.
Asia Times
24-04-2025
- Business
- Asia Times
World Bank 2d try at ranking economies for investors also lacking
In 2021, the World Bank shut down one of its flagship projects: the Doing Business index, a global ranking system that measured how easy it was to start and run a business in 190 countries. That followed an independent investigation that found World Bank officials had manipulated the rankings to favor powerful countries, including China and Saudi Arabia. The scandal raised serious concerns about the use of global benchmarks to shape development policy. Now, the bank is trying again. In October 2024, it launched its newest flagship report, Business Ready. The 2025 spring meeting of the World Bank and its sister institution, the International Monetary Fund, mark the first time the report will be formally presented to delegates as part of the institutions' high-level agenda. Nicknamed B-READY, the report aims to evaluate business environments through more transparent data. This time, the annual assessment has a broader ambition: to go beyond laws and efficiency and also measure social inclusion, environmental sustainability and public service delivery. As experts on international organizations, law and development, we have given B-READY a closer look. While we appreciate that a global assessment of the economic health of countries through data collection and participation of private stakeholders is a worthwhile endeavor, we worry that the World Bank's latest effort risks recreating many of the same flaws that plagued its predecessor. To understand what's at stake, it's worth recalling what the Doing Business index measured. From 2003 to 2021, the flagship report was used by governments, investors and World Bank officials alike to assess the business environment of any given country. It ranked countries based on how easy it was to start and run a business in each of 190 economies. In prioritizing that as its marker, the index often celebrated reforms that stripped away labor protections, environmental safeguards and corporate taxes in the name of greater 'efficiency' of common law versus civil law jurisdictions. As economist Joseph E. Stiglitz argued in 2021, from its creation the Doing Business index reflected the values of the so-called Washington Consensus − a development model rooted in deregulation, privatization and market liberalization. Critics warned for years that the Doing Business index encouraged a global 'race to the bottom.' Countries competed to improve their rankings, often by adopting symbolic legal reforms with little real impact. In some cases, internal data manipulation at the World Bank penalized governments that did not appear sufficiently business-friendly. These structural flaws − and the political pressures behind them − ultimately led to the project's demise in 2021. B-READY is the World Bank's attempt to regain credibility after the Doing Business scandal. In recent years, there has been both internal and external pressure to create a successor − and B-READY responds to that demand while aiming to fix the methodological flaws. In theory, while it retains a focus on the business environment, B-READY shifts away from a narrow deregulatory logic and instead seeks to capture how regulations interact with infrastructure, services and equity considerations. B-READY, which in the pilot stage covers a mix of 50 countries, does not rank countries with a single score. Rather, it provides more accurate data across 10 topics grouped into three pillars: regulatory framework, public services and operational efficiency. The report also introduces new themes such as digital access, environmental sustainability and gender equity. Unlike the Doing Business index, B-READY publishes its full methodology and makes its data publicly available. On the surface, this looks like progress. But a criticism of B-READY is that, in practice, the changes offer only a more fragmented ranking system — one that is harder to interpret and still shaped by the same investor-driven macroeconomic assumptions. In our view, the framework continues to reflect a narrow view of what constitutes a healthy legal and economic system, not just for investors but for society as a whole. A key concern is how B-READY handles labor standards. The report relies on two main data sources: expert consultations and firm-level surveys. For assessing labor and social security regulations, the World Bank consults lawyers with expertise in each country. But when it comes to how these laws function in practice, the report relies on surveys that ask businesses whether labor costs, dismissal protections and public services are 'burdens.' This approach captures the employer's perspective, but leaves out workers' experiences and the real impact on labor rights. In some cases, the scoring system even rewards weaker protections. For example, countries are encouraged to have a minimum-wage law on the books − but are penalized if the wage is 'too high' relative to gross domestic product per capita. This creates pressure to keep wages low in order to appear competitive. And while that might be good news for international companies seeking to reduce their labor costs, it isn't necessarily good for the local workforce or a country's economic well-being. According to the International Trade Union Confederation, this approach risks encouraging symbolic reforms while doing little to protect workers. Georgia, for example, ranks near the top of the B-READY labor assessment, despite not having updated its minimum wage since 1999 and setting it below the subsistence level. Another troubling area, to us as comparative law experts, is how B-READY evaluates legal issues. It measures how quickly commercial courts resolve disputes but ignores judicial independence or respect for the rule of law. As a result, countries such as Hungary and Georgia, which have been widely criticized for democratic backsliding and the erosion of the rule of law, score surprisingly high. Not coincidentally, both governments have already used these scores for propaganda and political gain. This reflects a deeper problem, we believe. B-READY treats the legal system primarily as a means to attract investment, not as a framework for public accountability. It assumes that making life easier for businesses will automatically benefit everyone. But that assumption risks ignoring the people most affected by these laws and institutions − workers, communities and civil society groups. B-READY introduces greater transparency and public data − and that, for sure, is a step up from its predecessor. But in our opinion it still reflects a narrow view of what a 'good' legal system looks like: one that might deliver efficiency for firms but not necessarily justice or equity for society. Whether B-Ready becomes a tool for meaningful reform − or just another scoreboard for deregulation − will depend on the World Bank's willingness to confront its long-standing biases and listen to its critics. Fernanda G Nicola is a professor of Law at American University and Dhaisy Paredes Guzman is a research assistant at American University. This article is republished from The Conversation under a Creative Commons license. Read the original article.
Yahoo
23-04-2025
- Business
- Yahoo
From Doing Business to B-READY: World Bank's new rankings represent a rebrand, not a revamp
In 2021, the World Bank shut down one of its flagship projects: the Doing Business index, a global ranking system that measured how easy it was to start and run a business in 190 countries. It followed an independent investigation that found World Bank officials had manipulated the rankings to favor powerful countries, including China and Saudi Arabia. The scandal raised serious concerns about the use of global benchmarks to shape development policy. Now, the Bank is trying again. In October 2024, it launched its newest flagship report, Business Ready. The 2025 spring meeting of the World Bank and its sister institution, the International Monetary Fund, mark the first time the report will be formally presented to delegates as part of the institutions' high-level agenda. Nicknamed B-READY, the report aims to evaluate business environments through more transparent data. This time, the annual assessment has a broader ambition: to go beyond laws and efficiency and also measure social inclusion, environmental sustainability and public service delivery. As experts on international organizations, law and development, we have given B-READY a closer look. While we appreciate that a global assessment of the economic health of countries through data collection and participation of private stakeholders is a worthwhile endeavor, we worry that the World Bank's latest effort risks recreating many of the same flaws that plagued its predecessor. To understand what's at stake, it's worth recalling what the Doing Business index measured. From 2003 to 2021, the flagship report was used by governments, investors and World Bank officials alike to assess the business environment of any given country. It ranked countries based on how easy it was to start and run a business in 190 economies. In prioritizing that as its marker, the index often celebrated reforms that stripped away labor protections, environmental safeguards and corporate taxes in the name of greater 'efficiency' of common law versus civil law jurisdictions. As economist Joseph E. Stiglitz argued in 2021, from its creation, the Doing Business index reflected the values of the so-called Washington Consensus − a development model rooted in deregulation, privatization and market liberalization. Critics warned for years that the Doing Business index encouraged a global 'race to the bottom.' Countries competed to improve their rankings, often by adopting symbolic legal reforms with little real impact. In some cases, internal data manipulation at the World Bank penalized governments that did not appear sufficiently business-friendly. These structural flaws − and the political pressures behind them − ultimately led to the project's demise in 2021. B-READY is the World Bank's attempt to regain credibility after the Doing Business scandal. In recent years, there has been both internal and external pressure to create a successor − and B-READY responds to that demand while aiming to fix the methodological flaws. In theory, while it retains a focus on the business environment, B-READY shifts away from a narrow deregulatory logic and instead seeks to capture how regulations interact with infrastructure, services and equity considerations. B-READY, which in the pilot stage covers a mix of 50 countries, does not rank countries with a single score. Rather, it provides more accurate data across 10 topics grouped into three pillars: regulatory framework, public services and operational efficiency. The report also introduces new themes such as digital access, environmental sustainability and gender equity. Unlike the Doing Business index, B-READY publishes its full methodology and makes its data publicly available. On the surface, this looks like progress. But a criticism of B-READY is that in practice, the changes offer only a more fragmented ranking system — one that is harder to interpret and still shaped by the same investor driven macroeconomic assumptions. In our view, the framework continues to reflect a narrow view of what constitutes a healthy legal and economic system, not just for investors but for society as a whole. A key concern is how B-READY handles labor standards. The report relies on two main data sources: expert consultations and firm-level surveys. For assessing labor and social security regulations, the World Bank consults lawyers with expertise in each country. But when it comes to how these laws function in practice, the report relies on surveys that ask businesses whether labor costs, dismissal protections and public services are 'burdens.' This approach captures the employer's perspective, but leaves out workers' experiences and the real impact on labor rights. In some cases, the scoring system even rewards weaker protections. For example, countries are encouraged to have a minimum-wage law on the books − but are penalized if the wage is 'too high' relative to gross domestic product per capita. This creates pressure to keep wages low in order to appear competitive. And while that might be good news for international companies seeking to reduce their labor costs, it isn't necessarily good for the local workforce or a country's economic well-being. According to the International Trade Union Confederation, this approach risks encouraging symbolic reforms while doing little to protect workers. Georgia, for example, ranks near the top of the B-READY labor assessment, despite not having updated its minimum wage since 1999 and setting it below the subsistence level. Another troubling area, to us as comparative law experts, is how B-READY evaluates legal issues. It measures how quickly commercial courts resolve disputes but ignores judicial independence or respect for the rule of law. As a result, countries such as Hungary and Georgia, which have been widely criticized for democratic backsliding and the erosion of the rule of law, score surprisingly high. Not coincidentally, both governments have already used these scores for propaganda and political gain. This reflects a deeper problem, we believe. B-READY treats the legal system primarily as a means to attract investment, not as a framework for public accountability. It assumes that making life easier for businesses will automatically benefit everyone. But that assumption risks ignoring the people most affected by these laws and institutions − workers, communities and civil society groups. B-READY introduces greater transparency and public data − and that, for sure, is a step up from its predecessor. But in our opinion it still reflects a narrow view of what a 'good' legal system looks like: one that might deliver efficiency for firms but not necessarily justice or equity for society. Whether B-Ready becomes a tool for meaningful reform − or just another scoreboard for deregulation − will depend on the World Bank's willingness to confront its long-standing biases and listen to its critics. This article is republished from The Conversation, a nonprofit, independent news organization bringing you facts and trustworthy analysis to help you make sense of our complex world. It was written by: Fernanda G Nicola, American University and Dhaisy Paredes Guzman, American University Read more: Scandal involving World Bank's 'Doing Business' index exposes problems in using sportslike rankings to guide development goals If US attempts World Bank retreat, the China-led AIIB could be poised to step in – and provide a model of global cooperation Can this former CEO fix the World Bank and solve the world's climate finance and debt crises as the institution's next president? The authors do not work for, consult, own shares in or receive funding from any company or organization that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.
Mint
23-04-2025
- Business
- Mint
Delhi Public Works Department drops arbitration in future contracts, opts for litigation
New Delhi: The Delhi Public Works Department (PWD), which is instrumental in the development of infrastructure in the national capital, has decided to move away from arbitration to resolve disputes in future contracts. The department said any dispute arising in the future will be resolved through litigation in Delhi courts, according to an order dated 21 April. Mint has seen a copy of the order. The decision follows an advisory issued by the finance ministry in June 2024, which asked all government entities—including departments, public sector undertakings (PSUs), and state agencies—to reduce their reliance on arbitration in public procurement contracts. The advisory cited high costs and delays associated with arbitration, and encouraged the use of mediation or court litigation instead. It also suggested that government entities should not engage in arbitration in public procurement contracts disputes where the value of the dispute was above ₹ 10 crore. It called for a case-by-case decision on whether to engage in arbitration when the disputed value was over ₹ 10 crore. Since then, several PSUs such as Oil India Ltd and ONGC Ltd have amended their contracts to reflect the advisory. The Karnataka government also removed arbitration clauses from its contracts choosing to resolve all disputes via litigation in courts. An email query to the chief engineer and the special secretary about Delhi PWD's decision did not elicit a response till press time. An arbitration clause is a commonly used dispute resolution clause. All contracts, agreements, and even treaties have dispute resolution clauses, which direct parties on how to resolve any issue between the parties. The government, the biggest disputant in the country, has not had a very successful track record in arbitration matters. A July 2024 Rajya Sabha disclosure by the union finance ministry said about 60% of the arbitral awards in case of PSUs such as National Highways Authority of India (NHAI) and NTPC Ltd were challenged, resulting in significant legal costs for the government. NHAI's pending claims under arbitration totalled ₹ 88,100 crore in FY23, a Rajya Sabha committee report said, adding that the figure was "worrisome". Arbitration was created as a method of out-of-court dispute resolution that is faster than litigation, a major advantage for commercial disputes in India, where courts are battling a massive pendency of over 60 million lawsuits. The Delhi PWD, the country's biggest disputant, cutting down its exposure to arbitration assumes importance as the quality of dispute resolution is an integral factor in the ease of doing business within the country. It also reflects the investment friendliness of a country, as dispute resolution mechanisms were a part of the World Bank's now discontinued Doing Business report, which measured the ease of doing business in each country. While India's overall score in the index improved to 71 in 2020 from 67.5 the year before in the Doing Business report, its score on contract enforcement—which measures dispute resolution efficiency—remained the same at 41.2 in the 2019 and 2020 Doing Business reports. "Business may not look at this (PWD's move) positively from a domestic or international perspective as it is indicative of pushing the dispute resolution process to our age old traditional ways," said Gauhar Mirza, partner, Cyril Amarchand Mangaldas. While the PWD's immediate recourse may be to adopt mediation, businesses who may seek contracts with the PWD are likely to think this decision goes against India's intent to become a hub for arbitration, he added. First Published: 23 Apr 2025, 02:18 PM IST
