The officials also questioned how Bharatiya Janata Party (BJP)-ruled states top the list, while states such as Tamil Nadu, Maharashtra and Punjab which are more industrialised and investor-friendly, are on the bottom. The report has not been received well by the state government, which held its first Global Investors Meet last week and signed memoranda of understanding worth Rs 2.46 lakh crore.
The officials asked how the report can compare states such as Jharkhand, Chhattisgarh and north-eastern states with states such as Tamil Nadu, which has higher penetration of industrialisation than the former lot. They said it's unfair that states without even proper roads, power, social security and a decent literacy ratio were compared with Tamil Nadu, which is much better placed in all these parameters.
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Tamil Nadu was the first state to implement single-window clearance way back in1995-1996. No state has the record of giving clearances in 12-30 days, which Tamil Nadu has, but no mark was given to this, they pointed out. "The report is not objective. They (World Bank) did not look at how effective the systems are in single-window clearances; how labour laws are how inspector raj has been reduced (in Tamil Nadu). It is very unfortunate," said a senior state government official. Another official said the report was based on how business can access services without any hassle through the internet, but not on what the state has achieved in terms of infrastructure.
As far as Tamil Nadu is concerned, one the major issues is related to value-added tax (VAT). In the survey, there were 44 questions, of which the answer was 'yes' for 28. For issues such as e-payment and e-signature, the state's commercial department has proposed some amendments. Once these amendments are passed by the legislature, the entire VAT administration will be online.
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The officials agreed that the state's labour department is not tech-savvy, but it has started online inspection.
"I don't think any serious investors will be fooled by all these things. Maharashtra and Tamil Nadu are the largest states in terms of growth of industry and output," said an official, who did not wish to be named. He, however, agreed that the neighbouring state of Andhra Pradesh is a tech-savvy and efficient with government departments taking to information technology early on.