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World bank ranks karnataka first

The World Bank has developed a new Investment Climate Index to help identify the key challenges and bottlenecks to be overcome in attracting business investment. In a policy research working paper, World Bank analyst Guiseppe Iarossi ranks the investment climate in 16 Indian States, using data from a survey of 4,000 entrepreneurs in 2005. Karnataka tops the list, with Kerala a close second. Tamil Nadu comes in at ninth place, overtaken by Gujarat, Andhra Pradesh, Haryana, West Bengal, Maharashtra and Delhi.

Having identified 46 variables descriptive of the business environment in the 16 States, the researcher grouped them into three categories: inputs, infrastructure and institutions. Two dimensions were identified for each category: the objective indicators of cost and the subjective indicators of perception.

Noting that both Delhi and Tamil Nadu seemed to be ranked lower than expected, the paper concludes that Delhi was dragged down by poor power infrastructure and the worst performance in terms of corruption of all 16 States. Tamil Nadu, on the other hand, finds its rankings lowered by poor performance on access to finance, lack of skills and availability of technology, according to paper.

The Index attempts to rank the most important bottlenecks to a better business climate, so that governments can better prioritise policies to remedy them with appropriate interventions. Infrastructure is the biggest variable distinguishing between the best and worst States on the Investment Climate Index, with electricity being the single biggest constraint within that category. This is confirmed by both subjective and objective indicators, with the bottom six States in the rankings facing a large number of power outages and large losses due to such outages. The second most important constraint is poor transportation infrastructure, according to the paper. The World Bank used the 2005 data collected in its Investment Climate Survey to construct the new Index.

January 17, 2009 Posted by | business | , , , , | 1 Comment

World Bank names blacklisted Indian IT firms

The World Bank on Sunday said it plans to publish in the future the names of all companies it bans from doing work with the poverty-fighting institution, and immediately listed three Indian companies.

The Bank said the move aligns its disclosure practices for companies involved in wrongdoing that work on development projects financed by the World Bank and those that provide goods and services directly to the institution.

“This change was made in the interest of fairness and transparency,” the Washington-based lender said in a statement.

Until now, the World Bank has only published the names of debarred companies involved in Bank-financed projects, but has not listed blacklisted firms that receive direct contracts from the institution under its corporate procurement program.

“There are currently three companies that have been debarred along with their affiliates under the Bank Group’s corporate procurement program,” the Bank said.

It said it debarred Satyam Computer Services, India’s fourth-largest software company, for eight years in September 2008, and Wipro Technologies, India’s No. 3 software company, for four years in June 2007 both for “improper benefits to bank staff”.

In addition, it said it had also barred India’s Megasoft Consultants for four years in December 2007 for “participating in a joint venture with Bank staff while conducting business with the Bank”.

All three companies were involved in different contracts and their debarments are not related.

The World Bank has long been under pressure to step up its fight again fraud and corruption within the institution and in projects it finances in developing countries.

Satyam’s chairman and founder Ramalinga Raju resigned last week after revealing years of accounting fraud in India’s biggest corporate fraud. Raju admitted last week that about $1 billion, or 94 percent of the cash on the company’s books was fictitious.

The World Bank acknowledged only in December it had debarred Satyam following press reports that the company had been blacklisted three months earlier for “improper benefits” given to Bank officials.

In Mumbai, Wipro Ltd said in a statement its revenues from the World Bank were insignificant and the decision by the Bank to bar it would not affect business and earnings.

Shares in Wipro fell more than 12 percent after the World Bank said it had barred the company from its direct contracts.

January 12, 2009 Posted by | news | , , , , , , , , | Leave a comment