Government Enhances Ease of Doing Business Since 2014
The Indian government has implemented numerous initiatives since 2014 to improve the Ease of Doing Business in the country. These steps, spearheaded by the Department for Promotion of Industry and Internal Trade (DPIIT), include a comprehensive Business Reform Action Plan (BRAP) designed to minimize barriers and increase transparency in regulatory processes. This effort has led to substantial reductions in time and costs for businesses looking to operate in India, reflecting in the doubling of active companies over the past decade.
Streamlining Regulations and Compliance
The BRAP has undergone seven editions, consistently gathering evidence and feedback to drive reforms at local levels. Significant amendments to the Companies Act, first enacted in 2013, were instituted in 2015, 2017, 2019, and 2020. These changes have addressed industry concerns, decriminalized minor violations, and simplified the compliance landscape for small companies and startups.
Support for Small Businesses
The Limited Liability Partnership (Amendment) Act of 2021 also played a crucial role by introducing the category of “Small LLP,” reducing compliance burdens, and lowering fees to encourage small business formalization. Additionally, private companies and various categories, including charitable and government entities, have benefitted from exemptions to numerous provisions under the Companies Act, further spurring economic activity.
Facilitating Business Operations
Incorporating a company has been made even more accessible; there are no fees for registering with an authorized capital of up to Rs. 15 lakh. Moreover, foreign listing options for Indian public companies have been expanded, promoting “Brand India” and encouraging growth in the technology sector. Fast-tracking of mergers has also been enhanced, allowing seamless consolidations among startups and small companies.
Digital Innovations and E-Governance
Key innovations, such as the introduction of the Central Registration Centre (CRC) in 2016, have streamlined business processes like name reservations and tax registrations through the centralized e-Form SPICe+. The establishment of the Centre for Processing Accelerated Corporate Exit (C-PACE) in 2023 and the Central Processing Centre (CPC) in 2024 further enhances the efficiency of corporate exit processes.
Increased Transparency and Reduced Burdens
Recent amendments to the Companies (Adjudication of Penalties) Rules have transitioned penalty adjudications to an electronic platform, boosting transparency and expediting processes. The Jan Vishwas Act of 2023 decriminalized over 183 provisions across 42 laws, significantly alleviating compliance burdens. This broad reform has resulted in over 47,000 compliance simplifications.
As of March 31, 2025, India boasts 1.85 million active companies, nearly double the figure from 2014. The integration of data analytics in the MCA21 V3 system has further improved compliance monitoring, indicating a strong commitment by the government to foster an enabling environment for businesses.
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