ISLAMABAD: In what appears to be the biggest upward shift in a year shown by a country, Pakistan rose 28 places and rose to the rank of 108 in the World Bank's Ease of Doing Business index and landed in the club of the top 10 of the world. Business climate improvers.
In its report for the year 2020 published on Thursday, the World Bank said that the promulgation of six regulatory reforms, including a concerted improvement in business regulation, had improved Pakistan's overall ranking that would improve the country's image to attract investment.
Global investors use the World Bank index as a guide to learn about a country's business environment before developing any business plan. Speaking to Twitter, Prime Minister Imran Khan said that Pakistan had achieved the greatest improvement in its history in the ease of doing business in the World Bank ranking. "During the last decade, Pakistan's ranking had fallen by more than 50 places. Now we have improved 28 places from 136 to 108," he added.
He said that this was another commitment of his manifesto that was achieved. “I want to congratulate all the people in our government who worked hard to make this happen. We still have a long way to go. InshaAllah, before the end of 2020, Pakistan will become one of the main places for investment, "he added.
Upload 28 places to position 108 of the World Bank's Ease of doing business classification
The adviser to the Prime Minister on Investment, Razak Dawood, described the significant improvement in the classification of a current government measure to provide an enabling environment for foreign investment. He said the government had set ambitious reform goals to reach position 70 and 80 in the World Bank classification in the coming years.
The adviser said that Pakistan had achieved the first position in the South Asian region by carrying out rapid reforms, in addition to having the sixth position in the world's leading reformers.
Other countries included in the club of the top 10 reformers are: Saudi Arabia, Kuwait, Jordan, Nigeria, India, China, Bahrain, Tajikistan and Togo. India remained in first place among the nations of South Asia with 63 years, followed by Bhutan with 89, Nepal with 94 and Sri Lanka with 99. Countries that are far behind in the ease of doing business in South Asia are Bangladesh in 168, Afghanistan in 173 and Maldives in 147.
Dawood said the World Bank 2020 report covered two main cities: Karachi and Lahore, adding that the improvement in the ranking was achieved thanks to the coordinated efforts of two provinces: Sindh and Punjab. He said the government would provide similar opportunities for investment in Balochistan and Khyber Pakhtunkhwa as well.
According to the World Bank report, the reforms that helped Pakistan improve its ranking are significant. Pakistan has facilitated the start of a business by expanding the features of the online one-stop shop. This reduced the number of procedures needed to establish a business from 10 to five and improved the economy's score to start a business.
In addition, in Lahore, the registration fee of the Department of Labor was abolished. The authorities made the approval process to obtain a building permit easier and faster in both Karachi and Lahore, respectively.
In Karachi, the process was also made safer by ensuring that building quality inspections were carried out regularly. Pakistan also facilitated the tax payment process by introducing online payment modules for value-added taxes and corporate income taxes. The government also lowered the corporate income tax rate. This reform reduced the number of payments from 47 to 34 and the total number of hours required to meet the tax requirements per year from 294 to 283.
Pakistan also facilitated obtaining electricity and property registration. Karachi and Lahore applied service delivery deadlines and launched an online portal for new applications. In addition, Pakistan increased the transparency of changes in electricity rates.
Karachi expedited the registration of the property by facilitating the execution and registration of a deed in the sub-registry office. Lahore increased the transparency of the land administration system by publishing its list of tariffs online. Finally, in the cross-border trade area, Pakistan improved the integration of several agencies in the Web-based One Customs electronic system and ensured the coordination of joint physical inspections at the port.
Pakistan continues to perform better in protecting the indicator of minority investors, earning the maximum possible points on the scope of the property and control index, which measures government safeguards that protect shareholders from improper control of the board. Globally, Pakistan is among the top 30 economies in this measure.
"This increase is significant and was possible thanks to the collective and coordinated actions of the federal government and the provincial governments of Sindh and Punjab over the past year," said Illango Patchamuthu, Country Director of the World Bank for Pakistan.
He said the accelerated reform agenda had many notable characteristics to improve the quality of regulations, reduce time and streamline processes. "This momentum must be maintained in the coming years for Pakistan to continue making progress," he added.
In the future, Pakistan has other opportunities for improvement in the areas measured by the Word Bank index. For example, in compliance with contracts, the country is ranked 156. It takes 1,071 days to resolve a trade dispute in Pakistan, almost double the average among OCED's high-income economies, the World Bank report said.
The report is based on surveys conducted in Lahore and Karachi, and the results are based on work done from November 2018 to June 2019.
Posted on Dawn, October 25, 2019