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Ease of Doing Business in

India

India Download Profile (2183.1KB, pdf)
Region South Asia
Income Category Lower middle income
Population 1,311,050,527
GNI Per Capita (US$) 1,590
City covered Mumbai, Delhi

190

1

DB 2017 Rank

1

100

DB 2017 DTF (% points)

  • local_library
  • group
Topics DB 2017 Rank DB 2016 Rank info_outline Change in Rank DB 2017 DTF (% points) info_outline DB 2016 DTF (% points) info_outline Change in DTF (% points) info_outline
Overall 130 131 up
1
55.27 53.93 down
1.34
Starting a Business 155 151 down
4
74.31 73.74 up
0.57
Dealing with Construction Permits 185 184 down
1
32.83 32.83
-
Getting Electricity 26 51 up
25
85.09 79.76 up
5.33
Registering Property 138 140 up
2
50.00 49.97 up
0.03
Getting Credit 44 42 down
2
65.00 65.00
-
Protecting Minority Investors 13 10 down
3
73.33 73.33
-
Paying Taxes 172 172
-
46.58 43.17 up
3.41
Trading across Borders 143 144 up
1
57.61 56.45 up
1.16
Enforcing Contracts 172 178 up
6
35.19 32.41 up
2.78
Resolving Insolvency 136 135 down
1
32.75 32.59 up
0.16

Positive= Doing Business reform making it easier to do business.Negative= Change making it more difficult to do business.

Viewing the data for

DB 2017 DTF (% points):

32.75

DB 2016 DTF (% points):

32.59

Change in DTF (% points):

up0.16

Indicator Mumbai South Asia OECD high income
Recovery rate (cents on the dollar) info_outline 26 32.6 73.0
Time (years) info_outline 4.3 2.6 1.7
Cost (% of estate) info_outline 9 9.9 9.1
Outcome (0 as piecemeal sale and 1 as going concern) info_outline 0 .. ..
Strength of insolvency framework index (0-16) info_outline 6 4.5 12.1
  • Indicator Explanation Answer
    Recovery rate (cents on the dollar) 26.0
    Proceeding To enforce its security interest, Bizbank would file a petition to the Debt Recovery Tribunal, governed by The Recovery of Debts Due to Banks and Financial Institutions Act, 1993. The debtor or other creditors will object before the High Court. foreclosure
    Outcome The reason why BizBank initiates the insolvency process is that the hotel is unable to pay its debts and the hotel expects operating losses in 2016 as well as 2017. Hence, in order to pay the debts, the hotel assets will be sold piecemeal and the hotel will stop operating. piecemeal sale
    Time (in years) Bizbank will apply to the Debt Recovery Tribunal to enforce its security. This will take a couple of months. But other creditors (including tax authorities) and Mirage itself will file objections in front of the High Court, which will delay the proceedings substantially. Given the high backlog of cases in India's High Courts, the foreclosure procedure until BizBank is repaid some or all of the money owed to it takes about 4.3 years. 4.3
    Cost (% of estate) The costs associated with the case would amount to approximately 9% of the value of the debtor's estate. Costs incurred during the entire foreclosure process mainly include court or government agency fees (INR 300,000, according to Mumbai Court fees Act, 1959), attorney fees (INR 100,000), costs of notification and publication (INR 25,000), fees of accountants, assessors, inspectors and other professionals (INR 100,000), fees of auctioneers (INR 50,000), fees of service providers and/or government levies (INR 100,000-200,000), and other fees (INR 100,000). 9.0
    Answer Score
    Strength of insolvency framework index (0-16) 6.0
    Commencement of proceedings index (0-3) 2.0
    What procedures are available to a DEBTOR when commencing insolvency proceedings? (b) Debtor may file for liquidation only 0.5
    Does the insolvency framework allow a CREDITOR to file for insolvency of the debtor? (b) Yes, but a creditor may file for liquidation only 0.5
    What basis for commencement of the insolvency proceedings is allowed under the insolvency framework? (a) Debtor is generally unable to pay its debts as they mature 1.0
    Management of debtor's assets index (0-6) 3.0
    Does the insolvency framework allow the continuation of contracts supplying essential goods and services to the debtor? No 0.0
    Does the insolvency framework allow the rejection by the debtor of overly burdensome contracts? Yes 1.0
    Does the insolvency framework allow avoidance of preferential transactions? Yes 1.0
    Does the insolvency framework allow avoidance of undervalued transactions? Yes 1.0
    Does the insolvency framework provide for the possibility of the debtor obtaining credit after commencement of insolvency proceedings? No 0.0
    Does the insolvency framework assign priority to post-commencement credit? (c) No priority is assigned to post-commencement creditors 0.0
    Reorganization proceedings index (0-3) 0.0
    Which creditors vote on the proposed reorganization plan? N/A 0.0
    Does the insolvency framework require that dissenting creditors in reorganization receive at least as much as what they would obtain in a liquidation? No 0.0
    Are the creditors devided into classes for the purposes of voting on the reorganization plan, does each class vote separately and are creditors in the same class treated equally? No 0.0
    Creditor participation index (0-4) 1.0
    Does the insolvency framework require approval by the creditors for selection or appointment of the insolvency representative? No 0.0
    Does the insolvency framework require approval by the creditors for sale of substantial assets of the debtor? No 0.0
    Does the insolvency framework provide that a creditor has the right to request information from the insolvency representative? Yes 1.0
    Does the insolvency framework provide that a creditor has the right to object to decisions accepting or rejecting creditors' claims? No 0.0

Note: Even if the economy’s legal framework includes provisions related to insolvency proceedings (liquidation or reorganization), the economy receives 0 points for the strength of insolvency framework index, if time, cost and outcome indicators are recorded as “no practice”.