Ease of Doing Business in Kerala

On behalf of MSME Day 2021, sharing some key aspects about Kerala. As per DIC statistics (#DirectorateOfIndustryAnadCommerce), there are 1,43,752 active units categorized under MSMEs in the state. Of which 88,526 are from manufacturing sector and 55,226 are performing in services sector. Total investment in MSME comes to around 14,176 crores. Employment generated is 7,15,618.

Kerala is the 8th State in the Country to undertake "Ease of Doing Business" #EoDBreform stipulated by the Department of Expenditure, Ministry of Finance. Kerala joined the seven other States Andhra Pradesh, Karnataka, Madhya Pradesh, Odisha, Rajasthan, Tamil Nadu and Telangana, who have completed this reform prior to that. The State has become eligible to mobilise additional financial resources of Rs.2,373 crore through Open Market Borrowings. Permission for the same was issued by the Department of Expenditure on 12th January, 2021.

The ease of doing business is an important indicator of the investment friendly business climate in the country. India ranks 63rd in "ease of doing business" with a DB score of 710 according to World bank Report. World Bank releases a statement on #doingbusiness in www.doingbusiness.org with measure of each element covered under the reform. Improvements in the ease of doing business will enable faster future growth of the state economy.

#EaseOfDoingBusiness is computed by aggregating the distance to frontier scores of different economies. The distance to frontier score uses the 'regulatory best practices' for doing business as the parameter and benchmark economies according to that parameter. The aggregated score becomes the Ease of doing business index.

Kerala Government has taken various initiatives as a part of the Ease of Doing Business including Kerala Investment Promotion and Facilitation Act, 2018, amending the 7 Acts and 10 Rules. This has ensured the creation of an environment that enabled establishing and running of enterprises in the State smoothly than it was earlier. The Government has ensured elimination of redundant regulations, simplification of clearance procedures, reduction in timelines for clearances, established Standard Operating Procedures, increased duration of clearances and establishing Investment Promotion and Facilitation Cells across the State and many more investor friendly programmes.

Government of Kerala also implemented a web-based application named Kerala Single Window Interface for Fast and Transparent Clearance (KSWIFT), which is a platform for all transactions with the Government on the issue of granting licences and approvals in a time bound manner.

Invest Kerala Portal, is another single window facilitator for investment promotion for prospective and aspiring investors. The Invest Kerala Portal is the common repository for land bank details, investor wizard, various services, schemes, lenders etc.

Enacted “The Kerala Micro Small and Medium Enterprises Facilitation Act, 2019” to exempt all projects having capital investments up to Rs 10 crores. and not falling under red category as notified by Pollution Control Board from licenses, approvals, permits etc. under various Acts for the first three years.

Government also identified priority sectors as the key drivers of growth for the years to come. Ensured setting up of dedicated industrial parks for each of the priority sectors enabling an all encompassed environment for industries in these sectors to start business.

Medical Devices Park

Mega Food Park

Petrochemical Park

Spices Park

Small Industries Park

Defense Park

Etc.

Apart from #KSWIFT, #InvestmentCell, B2B E-commerce Portal (www.keralaemarket.org, www.keralaemarket.kerala.gov.in, www.keralaemarket.com,) Toll Free Call Centre, Single Window Clearance Board etc. was allso established. As part of "Ease of Doing Business" it is reported that the state was able to achieve 94% of actions planned during 2020.

Kerala is transforming itself as an emerging destination for setting up enterprises and doing business. The State has become a center point for investors, with its advantages of abundant skilled labour, excellent industrial infrastructure, connectivity and industry friendly rules and regulations.

The State with a high Human Development Index has ensured specific focus on skill development initiatives for different industry domains. The initiatives to improve employability of workforce by the State Government has ensured that Kerala has achieved one among the top 5 ranks in the India Skills Report 2018. Skill development trainings are continuously being organized by #KIED Kerala Institute for Entrepreneurship Development. Individuals can register in KIED portal for free to attend the training programmes offered in various areas for development.

Taking in to consideration the present scenario, Covid19 and its imapct on MSMEs, the Government has come up with a program called "#VyavasayaBhadratha". Financial Assistance for Micro Small Medium Enterprises (MSMEs), a special package of relief to support and ensure sustainability of MSMEs.

This summarises some of the initiatives taken by the state government to develop the MSMEs as they contribute to 28% of India's GDP, 48% of total exports generated from MSMEs. MSMEs are the growth engine of Indian Economy generating employment for 110 Million people across the country.