India is easing the process of doing business

Question: Despite efforts being made by the Government to promote ease of doing business in India, delays are still being encountered when applying for new licences or for buying land for industrial use. Is anything being done to ease the situation?

ANSWER: The Ministry of Commerce is about to launch the National Single Window System (NSWS). This portal is being tested and will be ready in the next few weeks. About 27 central departments and 19 states and Union Territories have currently joined this portal. For all limited companies a data base has been created, like the names and addresses of directors of companies and other information which is necessary to secure approvals for new projects, licence renewals, and for buying land. Once the NSWS comes on stream, a company would merely have to fill in its Permanent Account Number on the portal. This will auto populate the required forms and only current figures of relevant information will need to be entered. Thus, there will be a single entry point and will facilitate doing business in India. The National Land Bank which currently has 100,000 hectares in different industrial parks located in several States of India is also integrated with NSWS. Industrialists who want to buy land would be able to see the land and facilities around it through the GIS-enabled portal on their computer screens. If they decide to purchase or lease land from industrial development corporations, it would be possible to do so online. State Governments will be able to grant all approvals expeditiously through the NSWS.

Question: In order to get home loans, one has to be physically present in India in order to sign several documents which are processed by banks and mortgage companies. As a result, non-resident Indians are always at a disadvantage as they have to frequently travel to India. The Government should consider this issue to help NRIs.

ANSWER: The Ministry of Electronics and Information Technology has completed digitisation pertaining to several types of contracts, like mortgages. Recently, the ministry has issued a notification whereby home loans will be brought under the digital documentation category. Vendor and supplier documents have already been digitized so that a contract can be entered into between the parties in demat form electronically. Therefore, it will no longer be necessary for the buyer and seller to be physically present at the registration office in India because e-execution of agreements will become a reality. This will dramatically increase granting of home loans to buyers of residential properties. It will also increase the volume of car loans and gold loans as all documents will be processed online. What has made online lending possible for banks and institutions is the availability of structured and unstructured data, as well as availability of credit scores of borrowers. Banks are also using technology which would take into account data from social media which will help them to build credit profiles of the borrowers.

Question: The global toy industry has been dominated by China during the past few years. With Covid restrictions being imposed in that country, this has created a worldwide shortage. Will India be able to take advantage of this situation and increase its own manufacturing capacity?

ANSWER: Several measures have been announced by the Indian Government to give a boost to the toy industry. Customs duty on imports has been increased to 60% from 20% which has promoted domestic manufacturing. Quality control orders have been made applicable for toys by the Bureau of Indian Standards. This will give incentives for manufacturing the full product and not just components. The Production Linked Incentive scheme has been extended to the manufacture of toys in India. The PLI scheme has also been extended to those companies which manufacture vaccine materials, certain telecom products, shipping containers, bicycles and footwear. Companies incorporated recently which start manufacturing by 31st March, 2024 will pay corporate income tax at a rate of just 15%.

H. P. Ranina is a practising lawyer, specializing in tax and exchange management laws of India

• Business