New Delhi: Patna is ahead of Mumbai, but second only to New Delhi in terms of ease of starting a business, according to a World Bank ranking announced on Tuesday.
Of the 17 cities figured in the World Bank and International Finance Corporation's "Doing Business in India 2009" report, Jaipur, Hyderabad and Bhubaneshwar are the other cities where it is easier to start a business.
Starting a business measures the necessary steps to enable small or medium enterprise in general commercial or industrial activities to operate legally in 17 Indian cities -- including permits, inscriptions, notifications and inspections.
The report further said doing business is the easiest in Ludhiana, followed by Hyderabad, Bhubaneshwar, Gurgaon, Ahmedabad, New Delhi, Jaipur and Guwahati.
Of the 17 cities considered, Patna was ranked 14th, above Chennai, which stood at 15th position, while Kolkata was at the bottom of the list.
The report ranks the cities based on seven parameters -- starting a business, dealing with construction permits, registering property, paying taxes, trading across borders, enforcing contracts and closing a business.
However, the rankings do not take into account the macroeconomic conditions, infrastructure, workforce skills or security.
The report said that it is easier to start and operate business in India than it was three years ago in many large cities of the country.
It said starting a business is the fastest in Mumbai and Noida, while in cost terms; business start-up is least expensive in Patna.
It is easier to pay taxes in Ludhiana, Jaipur and Noida while it is difficult to do so in Chennai, Kolkata and Patna.
Paying taxes records all taxes and mandatory contributions that a medium-sized company must pay as well as measures the administration burden of paying taxes and contributions.
According to the report, that it is the easiest to export and import goods from Bhubaneshwar while it is most difficult from Gurgaon.
The report also said that compared to economies world wide, cities in India lag most in the ease of closing a business and paying taxes.
In India, where more than 90 per cent of jobs are in the informal sector, regulatory reforms can help businesses operate efficiently in the formal sector, it said.
"Reforms that cut red tape, clarify property rights, and streamline regulatory compliance, can yield big payoff for firms and workers," World Bank group financial and private sector development Acting Vice-President Penelope Brook said in a CII function.