Business ease

September 30, 2019

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THE World Bank has declared that Pakistan has made a great deal of progress in its ease of doing business reforms, and as a result, the country is among the top 20 ‘improvers’ in the world. Soon the bank will release its ease of doing business rankings, and it is expected that Pakistan will exhibit significant improvement in its position too. The reforms focus on six areas in particular — starting a business, dealing with construction permits, getting electricity, registering property, paying taxes and trading across borders. In these areas, the registration of a new business has become easier. The use of online portals has helped a great deal, and soon the Federal Board of Revenue plans to introduce an app and a portal for filing tax returns as well, thus reducing contact between the taxpayer and the taxman.

Some of the credit for this change goes to the federal government, particularly the Board of Investment where these reforms were first conceived. In equal measure, the World Bank has lauded in its report the role of the Sindh Building and Control Authority and the Lahore Development Authority that have “streamlined workflows and improved the operational efficiency of their one-stop shops”. The BoI had initiated these reforms in October last year under its 100-day sprint programme. The latter focused the reform effort on one point specifically: it should take a maximum of 100 days to get a new business up and running. All approvals should be possible to arrange within that time frame. Perhaps it is because of these reforms, in part, that the Securities and Exchange Commission of Pakistan was able to announce that 1,187 new companies were registered in the month of August alone, and 94pc of these were done through the e-portal where registration happens on the same day. This streamlining is essential to unleashing the entrepreneurial energies of the citizenry, and encouraging more businesses to comply with tax requirements. The sad thing to note, however, is that the government easily accepted the resignation of the architect of these reforms, the former chairman of the BoI, when he was frustrated with the pace of movement in other areas that particularly had to do with the Special Economic Zones. The improvement in the ease of doing business reforms testifies to how committed professionals can deliver results. But retaining them should also be a priority for the authorities.

Published in Dawn, September 30th, 2019