Punjab in partnership with GAME and Omidyar Network India prioritizes Ease of Doing Business (EoDB) for MSMEs – Set to Become EoDB Lighthouse State

Punjab,: Capt. Amarinder Singh, Hon’ble Chief Minister of Punjab today announced a slew of reforms the State Government has initiated to reduce the regulatory burden on MSMEs in Punjab. The reforms are based on the GAME EoDB Taskforce’s report titled “Transforming EoDB for MSMEs in Punjab”, which proposed data-informed regulatory changes to rationalize, digitize, and decriminalize the regulatory landscape. GAME signed an MoU in November 2020 with the Government of Punjab to showcase the state as an ‘Ease of Doing Business for MSME’ lighthouse in partnership with Omidyar Network India, an investment firm focused on social impact, under their ReSolve Initiative.

Global Alliance for Mass Entrepreneurship (GAME) is an alliance of organizations that aims to catalyze a nation-wide entrepreneurial movement which enables growth and mobility of Existing and new enterprises, 30% of which are women owned, to create 50 million jobs. Omidyar Network India’s ReSolve Initiative focuses on providing support for lighthouse projects that are creating solutions to empower MSMEs as well as migrant workers.

GAME’s EoDB taskforce proposed five recommendations for priority roll-out and divided into two sections – labour and non-labour. For a typical MSME, labour constitutes more than half the compliance burden and hence a bulk of the recommendations were labour related such as decriminalizing more than 275 low risk offences related to labour, reducing Labour registers from 60 to less than 14, further improving flexibility to hire women workers, and reducing interface with inspectors by removing permission on deductions for leave or absence. These changes will be incorporated in the new State Rules.

The Chief Minister emphasised that this is the start of the transformation journey and set commitments for future changes including rationalising trade license with shops & establishments act, removing imprisonment terms from 100 low risk provisions in non-labour related rules, reducing pre-commissioning licenses & NOCs to start a business by 20%, and streamlining procedures for Change in Land Use & Utility connections.

Speaking at the “Punjab as EODB Light House- Phase 1” event, Capt. Amarinder Singh, Hon’ble Chief Minister of Punjab said, “Punjab offers one of the best ecosystems for entrepreneurs to thrive, and together with GAME, we are excited to push the State’s efforts much further. With just 3 months of the collaborative work, we have started on the journey to make Punjab a ‘right to business’ State. We want Punjab to become the best State in EoDB for MSMEs. These reforms are the start of a journey, and we hope to make Punjab a lighthouse State for MSME growth support. We have listened to entrepreneurs on the ground and we will continue to reduce the compliance burden to start, operate, and grow a business.”

Mrs. Vini Mahajan, IAS, Chief Secretary to the Government of Punjab said, “It has been a very encouraging and promising start in partnership with GAME, Omidyar Network India, Trayas Foundation, Avantis RegTech, and Center for Civil Society to implement substantive changes. Data driven thought leadership, and strong Government commitment were key to the early success of this partnership. The Department of Investment Promotion, Industries & Commerce and Labour stewarded these reforms admirably and demonstrated the strength of a government working as one.” Furthermore, a monthly data-oriented assessment of delays in licenses and permits will be undertaken to ensure that entrepreneurs do not lose valuable time in starting or scaling their business.”

Sharing his thoughts, Dr. KP Krishnan, IAS (Retd), Former secretary, Government of India who is also the Chairperson of the GAME EoDB Taskforce said “With the lockdown hitting MSMEs the hardest, the time is ripe for the State to intervene. The recommendations of the taskforce will help do away with outdated regulations that hindered formalization and growth of MSMEs and help them thrive as the engine of the Indian economy”

Talking about GAME’s work in Punjab, Ravi Venkatesan, Founder, Global Alliance for Mass Entrepreneurship (GAME) said, “Punjab has shown that when there is political will and committed administrative leadership, it is possible for Government, civil society, private sector and small business owners particularly to work together and achieve dramatic progress in a short period of time through simplification, digitization and decriminalization.”