• Only one unit started operations since 2014 in Nagaland
• NITI-Aayog & IDFC’s survey finds faltering policy initiatives
Moa Jamir
Dimapur | August 30
The Central government’s recent ‘big push’ policy initiatives for manufacturing start-ups, given their potential for creating jobs and driving growth, seems to have little impact on the ground, particularly in Nagaland, a new enterprise survey report has highlighted.
The number of manufacturing enterprises that started ‘operations during or after 2014’ in Nagaland was only one, according to the nationwide survey report titled, ‘Ease of Doing Business - Enterprise Survey of Indian States.’ The survey was conducted jointly by the NITI Aayog and Infrastructure Development Finance Company (IDFC) Institute, a Mumbai-based think tank and the report released on August 28.
However, Nagaland state was not alone. Goa, Haryana, Tripura, and Uttar Pradesh account for only one manufacturing start-ups during the same period. Around 63% young manufacturing firms included in the survey were located in Maharashtra, Telangana and Gujarat.
Collected during 2016, the survey undertaken to monitor the business environment in the country, surveyed 3,276 enterprises, including 141 early-stage firms, across 23 categories in India in all states and Union Territories (UTs), except Arunachal Pradesh, Mizoram, Andaman and Nicobar and Lakshadweep.
It focused on the ultimate beneficiaries of doing business reforms—the enterprises, and assessed the implications of regulations and compliance requirements for enterprises by focusing on time taken for getting various approvals, whether costs incurred in fulfilling regulatory compliances are higher than the prescribed fees and enterprises’ perceptions of how different regulatory processes impede their businesses.
Nagaland Report Card
According to the report, 30 enterprises from Nagaland were included in the survey. The samples were taken from the Annual Survey of Industries (ASI) 2014-15, which has database of 197 enterprises from the state. For manufacturing start-ups, the data from the Ministry of Micro, Small, and Medium Enterprises under the Udyog Aadhar scheme was used.
Out of this, only one new unit was operating since 2014. Further highlighting the sorry state of progress in the state, out of the 30 enterprises, over 80% was classified as old, which according to the survey include those that have existed for more than ten years.
Thus, only about 5-6 new manufacturing units were established in Nagaland in last 10 years. Overall, out the total enterprises surveyed, the survey stated that 799 were classified as young and 2,477 as old.
Interestingly, none of the enterprises from Nagaland were aware of the set relevant guidelines as well as environmental category of their concerned business.
It was undertaken to determine the extent of environmental damage caused by them and regulatory mechanism used to keep violations under check, the report said.
“Each enterprise is expected to know the category to which it belongs so that it can follow the rules prescribed for its category to measure awareness and implementation on ground,” it noted.
Keeping the state company in the lowest proportion of environmental awareness were Bihar (33%), Odisha (22%), and Manipur (4%). Among high-awareness states were 89% enterprises in Kerala, 86% in Sikkim, and 85% in Andhra Pradesh.
Regarding legal issues in civil court and administrative tribunals, Nagaland along with Bihar, Meghalaya, and Uttarakhand did not have any pending legal disputes.
Out of the 30 enterprises in the state, 83.33% were considered labour intensive needing a large amount of labour to produce its goods or services, indicating that they are mostly agro-based or primary sector units.
The survey also categorised the Nagaland as a low-growth state.
Startup-up India faltering?
An important and surprising finding of the survey is that the awareness among enterprises about single window systems is low, the report said. Many were unaware of the improvements undertaken both by the Union and state governments.
“On average, only about 20% of start-ups, which are of recent origin, report using single window facilities introduced by state governments for setting up a business,” it noted.
There is a clear need for creating greater awareness. In cases where the lack of use is due to poor functioning of the service, the functioning must be improved, it recommended.
Overall, while it varies state-wise, the report showed that the average time taken to set up a business in India was 118 days; 112 days for getting construction permit; 74 days for labour approvals and renewals; and the average hours of power shortage per month faced by enterprises are around 46 hours in the country. Enterprises in high-growth states reported lower time taken on average for nearly all areas of doing business, it noted.
Meanwhile, the Union Government on August 30 has dismissed some of the critical findings in the survey-based report and distanced itself from survey report, according to The Economic Times.
“The report itself states that it is meant to be a research document and its contents do not represent the views of the Government of India or NITI Aayog,” it said, quoting from a government statement.
