Why India’s Ease of Doing Business Reforms Remain Central to Its $5 Trillion Economy Ambition

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• April 18, 2026
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India’s Ease of Doing Business (EoDB) reforms represent a sustained multi-year effort to dismantle regulatory barriers, reduce compliance burdens, and attract both domestic and foreign investment. These reforms directly influence India’s competitiveness in global capital allocation and remain critical to achieving the government’s $5 trillion economy target.

New Delhi, April 2026 — India’s journey from 142nd position in the World Bank’s Doing Business rankings in 2014 to 63rd in 2019 marked one of the most significant regulatory transformations among major economies in the past decade. The abolition of the World Bank’s Doing Business report in 2021 following methodological controversies has not diminished the structural importance of these reforms for India’s growth trajectory.

What Is Driving India’s Focus on Ease of Doing Business?

India’s EoDB push stems from the recognition that cumbersome regulations historically deterred both foreign direct investment and domestic entrepreneurship. The average time to start a business in India dropped from 127 days in 2014 to approximately 18 days by 2020, reflecting tangible procedural improvements. State-level competition through the Business Reforms Action Plan (BRAP) has created a federal race-to-the-top dynamic, with Andhra Pradesh, Telangana, and Gujarat consistently leading reform implementation. The government’s Production-Linked Incentive schemes and infrastructure modernisation efforts complement regulatory simplification to create a holistic investment environment.

What Are the Key Government Initiatives Transforming Business Climate?

The government has deployed multiple reform vectors simultaneously across central and state administrations. The Goods and Services Tax unified India’s fragmented indirect tax system, eliminating inter-state barriers that previously fragmented the domestic market. The Insolvency and Bankruptcy Code reduced average resolution timelines from 4.3 years to under 2 years for admitted cases. Single-window clearance systems now operate in over 20 states, consolidating what previously required engagement with dozens of separate departments.

• India improved 79 positions in World Bank EoDB rankings between 2014 and 2019
• Contract enforcement resolution time reduced from 1,445 days to 1,095 days
• Construction permit processing consolidated from 34 procedures to 19
• Property registration digitised across 730+ districts under DILRMP
• Over 25,000 compliance requirements decriminalised or removed since 2020

How Does India Compare Globally on Business Environment?

India’s regulatory environment now benchmarks favourably against several ASEAN competitors on specific parameters, though gaps remain versus Singapore, South Korea, and advanced economies. Labour law rigidity and land acquisition complexity continue to feature in investor surveys as persistent friction points. The World Bank’s successor Business Ready index, launching progressively, will provide fresh comparative data that India must monitor closely. China’s regulatory efficiency, despite geopolitical tensions, remains a benchmark that competing manufacturing destinations including India must match to capture supply chain diversification flows.

What Should Investors and Businesses Watch?

State-level variation in reform implementation creates uneven experiences for businesses operating across multiple jurisdictions. The pending labour code implementation—consolidating 29 central laws into four codes—will significantly impact manufacturing competitiveness once notified by remaining states. Judicial infrastructure modernisation remains underfunded relative to caseload growth, affecting contract enforcement predictability. Digital public infrastructure including ONDC and Account Aggregator frameworks represents a new frontier of business facilitation beyond traditional EoDB metrics.

Analyst’s View

India’s EoDB reforms have delivered measurable gains, but the next phase requires deeper institutional capacity building rather than additional procedural changes. The focus must shift from process digitisation to outcome measurement—tracking actual time-to-operate for businesses rather than statutory timelines. Investors should monitor implementation of the Jan Vishwas Act amendments decriminalising minor offences, state-level labour code adoption rates, and commercial court disposal statistics as leading indicators of ground-level business climate evolution.