India has made great strides in Ease of Doing Business Ranking. It is now at # 77 out of 189 countries. In order to make further strides, and also to achieve the target of a sustainable 8 per cent GDP growth rate over the next decade, the government needs to concentrate on those parameters in which India scores low.
The worst is ‘Registering Property’ (rank 166) followed by ‘Enforcement of Contracts’ (Rank 163).
It is disheartening to read that over six million cases are unresolved for five years; 66,000 for more than 30 years and 140 for over 60 years!
This is beyond absurd! It is pathetic!
A Congress leader, 73, was sent to jail last week, 34 years after the 1984 riots in which he was found to be an instigator. An accused in a duplicate stamp paper case was acquitted after 15 years, for want of evidence, but a year after he had died.
Other countries have a time-bound judicial system. At the start of the trial the judge decides the time-frame in which he would complete it and confirms dates on which both sides would argue their cases and make final submissions. Each side is granted 1 or 2 adjournments and no more. That is how it should be.
On the contrary, in India judges grant adjournments for the flimsiest of reasons, and without limit. Little wonder, then, that cases drag on for 60 years, defeating the purpose of justice. The delay only helps the perpetrator of the crime and hurts the victim. This is not the purpose of a judicial system. In fact, it’s the direct opposite.
Now, in order to achieve consistent 8 per cent growth in GDP, Niti Aayog has calculated an investment rate of 32 per cent. This cannot happen without encouraging savings. And savings cannot be encouraged without investor protection.
Given that, expecting investors to save 32 per cent of their income is a tall ask, if they do not get protection for it.
Not only the courts, investigative agencies are also unsympathetic to victims of fraud. The accused in the stamp paper case was acquitted for want of proper evidence, properly presented, as were others in previous scams. The Hyderabad High Court last week set aside an order of the Enforcement Directorate which had impounded ₹822 crore, in 2012, claiming that this was ‘proceeds of crime’ of Satyam Computer, in a self-confessed fraud prior to the takeover by Tech Mahindra. It was pointed out that at the time of takeover there were no funds; the ₹822 crore was built up by the new management! This fact ought to have been investigated prior to passing an order, 7 years ago.
The government must sit down with the judiciary and the investigative agencies, and assure that justice is delivered, fairly, efficiently and swiftly. Whatever resources are needed for it must be made available. Else, an 8 per cent GDP growth will remain a pipe dream.
The BSE sensex has moved sideways last week. According to Trump’s tweet, he is satisfied that a deal with China over trade issues would be worked out, which would ease investor concerns. If so, it would be bullish.
The other bullish factor is the likely permission to investors of EPFO, the largest pension fund, to raise their equity component. Indian stock markets can be expected to rise moderately until General Elections are announced.
(The writer is India Head — Finance Asia/Haymarket. The views are personal.)