Center grants additional borrowing permission to AP for faring better on “Ease of Doing Business”

New Delhi, Oct 3 (KNN) Ministry of Finance (MoF) has granted additional borrowing permission to Andhra Pradesh for successfully undertaking reforms in the Ease of Doing Business.

Andhra Pradesh has become the 1st State in the country to successfully undertake “Ease of Doing Business” reforms. This has made state eligible to raise an additional amount of Rs. 2,525 crore through Open Market Borrowings.

Earlier Andhra Pradesh had also completed PDS reforms to enable One Nation One Ration Card System.

Ease of Doing Business is an important indicator of an investment friendly business climate in the country. Improvement in the ease of doing business will enable faster future growth of the state economy.

Therefore, in order to incentivize implementation of district level and licensing reforms for ease of doing business, an additional borrowing facility of 0.25 per cent of GSDP has been allowed to States on the recommendation of the Department for Promotion of Industry and Internal Trade (DPIIT).

The reform envisages undertaking all of the following actions by the State Governments. The State will complete the first assessment of ‘District Level Business Reform Action Plan’ as intimated by DPIIT.

The State will eliminate the requirements of renewal of certificates/ approvals/ licences obtained by businesses for various activities from the authorities at the State level as per list circulated by DPIIT. Collection of reasonable fees with automatic non-discretionary deemed renewal will also be permissible as reform if done in a transparent online, non-discretionary & automatic manner.

The State will implement computerized central random inspection system under the Acts as per list circulated by DPIIT wherein allocation of inspectors is done centrally, the same inspector is not assigned to the same unit in subsequent years, prior inspection notice is provided to the business owner, and inspection report is uploaded within 48 hours of inspection.

In view of the unprecedented COVID-19 pandemic, the Central Government had in May, 2020 allowed additional borrowing limit of up to 2 percent of Gross State Domestic Product (GSDP) to the States for the year 2020-21.

This made an amount up to Rs. 4,27,302 crore available to the States. One percent of this is subject to implementation of four specific State level reforms namely Implementation of One Nation One Ration Card System, ease of doing business reforms, Urban Local body/ utility reforms and power Sector reforms, where weightage of each reform is 0.25 percent of GSDP.