The Finance Ministry, in session with Niti Aayog and DPIIT, will quickly determine on the parameters for the ‘Funding Friendliness Index of States’, which is able to goal to create wholesome competitors amongst states to attract personal investments, Expenditure Secretary Manoj Govil stated on Sunday.
The 2025-26 Price range introduced the launching of an Funding Friendliness Index of States in 2025 to additional the spirit of aggressive cooperative federalism.
In an interview with PTI, Govil stated whereas many laws and reforms have been executed on the degree of the Centre, some traders really feel that related reforms are wanted on the state degree.
The index will nudge the states to have a look at the laws to see what’s holding again investments.
“The primary thought will not be a lot to rank the states and to say who is sweet or dangerous however extra to immediate the states to try their very own guidelines, laws and procedures and to seek out out from them that are those which traders deem or discover unfriendly, unworkable or tough and the way does that have an effect on the states in getting investments,” Govil stated.
The timeline for the launch of the index can be determined by the Division of Financial Affairs and Niti Aayog, in addition to the Division for Promotion of Trade and Inner Commerce (DPIIT).
Govil stated all states would love extra funding to come back in and therefore they wish to re-examine their laws. In that spirit, the concept of this index has are available Price range.
“To make the index, we nonetheless have to pick out the standards, its not forged in stone,” he stated.
For example, if some states have 15 procedures for an investor eager to arrange a manufacturing facility, whereas some have solely 5, the lagging states might emulate the successes achieved by their counterparts.
“Greater than us, it’s the state governments who must do that train and discover out what are the issues that the traders face,” Govil added.
Presently, the DPIIT undertakes an annual train of rating states and union territories by way of ease of doing enterprise. Additionally, it categorises states and UTs efficiency throughout the important thing pillars of Logistics Infrastructure, Logistics Providers and Working and Regulatory Surroundings.
