Friday 4th June 2010

India tops poll as being the most bureaucratic place for expats to live

The Political and Economic Risk Consultancy (PERC) have named India as possessing the most inefficient bureaucratic system in Asia in their recent survey of 1,373 middle and senior expatriate business executives.

They survey, which asked business executives to rank the bureaucratic efficiency of 12 different countries in Asia, found that those surveyed believed that India was the most inefficient country in which to do business and awarded the country 9.41 out of a possible 10 on a scale of inefficiency. India’s score was far higher than all the other countries, with the full results being as follows:

1) India 9.41

2) Indonesia 8.59

3) The Philippines 8.37

4) Vietnam 8.13

5) China 7.93

6) Malaysia 6.97

7) Taiwan 6.60

8) South Korea 6.13

9) Thailand 5.53

10) Hong Kong 3.49

11) Singapore 2.53

In a statement issued with their findings, PERC, a Hong Kong based group, commented that they believed that many governments in Asia had become “power centers” and often resisted efforts by other politicians to reform their operations. They also specified that they believed that red tape was a significant deterrent for foreign investment, commenting, “The inertia generated by a stifling bureaucratic system will, in the medium term, prevent India matching the growth rates of its great Asian rival China.”

They expressed their opinion that, while China had scored much better than India in their findings, red tape is a “serious problem” in both countries, “but the differences in the political systems of these two countries have made inertia much worse in India than in China," they said.

Commenting on The Philippines, which was positioned at the third most bureaucratic country in Asia, PERC said that the government there "goes through the motion" of addressing problems of bureaucratic red tape "but nothing has really made a dent in the problem.

"Illegal fixing is well-entrenched in the Philippine bureaucracy," they said, saying that their findings revealed that an operation involving “fixers” was prevalent in the country. Fixers are individuals who facilitate business transactions with government officials for a fee and are often involved with corrupt deals and contracts.

Speculating as to the reason for India’s position in the rankings, Dr. Gareth Price, head of the Asia program at think tank Chatham House, told UK newspaper The Telegraph that there were a number of factors that contributed to executive’s perceptions of the bureaucracy in India, “Firstly, in a country with around 1.2 billion people, there are only 15 million government employees in India, which isn’t really enough for a smooth-running bureaucracy.

“Furthermore, India’s bureaucracy is based on complicated and antiquated rules, which unfortunately for expat businessmen, many inspectors and government officials have a vested interest in leaving as they are. Old laws are rarely repealed, so if the government wants to, anything can be shut down. It’s certainly a system you’ll need advice on to get your head round.

“By contrast, Singapore has made a real effort to simplify its bureaucracy, and its popularity with businessmen in this survey is the result.”

Officials in The Philippines have refuted the results, which placed them in third place in the list of the most bureaucratic countries in Asia, claiming that the flow of investments that are continually observed in their country belie the findings of the PERC survey. Speaking in a press conference, Deputy Presidential Spokesman Rogelio Peyuan said: “if our standing is really that bad, there would not be enough foreign investments coming into the country. It’s a fact that foreign businessmen have been arriving here, and many sectors continue to be robust.”

Read the full article: http://www.asiarisk.com/

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