Reforms in South Asia, 2008-09

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Afghanistan

Afghanistan simplified business start-up by taking company registration out of the commercial courts and establishing a new company registry that acts as a one-stop shop combining company registration, tax registration, and publication in the official gazette, and charges a flat registration fee. The government also eased property registration by cutting the property transfer tax by 3 percent of property value. Access to credit was strengthened with a new law on secured transactions that broadens the scope of assets that can be used as collateral—including future assets—and allows a general description of debts and obligations. The new law also allows out-of-court enforcement.

Areas of Reform: Starting a business, Registering property, Getting credit (legal rights)
Rank in Doing Business 2010: 160

Bangladesh

Bangladesh simplified business start-up by launching online business name clearance and registration, shortening start-up time by 29 days. It also cut the corporate income tax rate from 40 percent to 37.5 percent, while increasing the capital gains tax rate from 5 percent to 15 percent. Automation of customs clearance at the Chittagong port has shortened the time required to clear goods.

Areas of Reform: Starting a business, Paying taxes, Trading across borders
Rank in Doing Business 2010: 119

Bhutan

In Bhutan, no major reform was recorded.

Rank in Doing Business 2010: 126

India

In India, procedures under the 2002 Securitization Act have become more effective, easing the process and reducing the time required to close a business.

Areas of Reform: Closing a business
Rank in Doing Business 2010: 133

Maldives

The Maldives made employment less flexible by restricting the use of fixed-term contracts, introducing restrictions on weekly rest, and increasing mandatory annual leave.

Areas of Reform: Employing workers (making it more difficult)
Rank in Doing Business 2010: 87

Nepal

Nepal’s Finance Act 2008 has reduced the fee for transferring a property from 6.0 percent to 4.5 percent of the property’s value.

Areas of Reform: Registering property
Rank in Doing Business 2010: 123

Pakistan

Pakistan simplified business start-up by introducing a system that allows online registration for sales tax and removing the requirement to make a declaration of compliance on a stamped paper. These moves removed four days and one procedure and halved the cost of the business start-up process.

Areas of Reform: Starting a business
Rank in Doing Business 2010: 85

Sri Lanka

Sri Lanka has strengthened access to credit information with a new system consolidation process at the private credit bureau, allowing credit data to be submitted by all shareholder lending institutions without any reporting threshold. The volume of registry data has grown 10-fold relative to the same period in 2007. Yet the government also made getting construction permits more difficult by increasing fees and adding a procedure.

Areas of Reform: Getting credit (information), Dealing with construction permits (making it more difficult)
Rank in Doing Business 2010: 105