Undoubtedly, government policies play a very important role in how a business functions and it is the changes in these very policies that can affect the success and state of an enterprise. MYB looks at five policy changes that entrepreneurs are looking for in order to help ensure profitability and smooth functioning of their businesses.

1. Increased focus on infrastructure

The lack of infrastructural facilities can seriously hamper the long-term profit earning ability of businesses. It is essential for the government to improve upon existing roadways, waterways, airways, and channels of telecommunication for the efficient supply of goods and services, provided by enterprises. A provision for adequate power and water supply amenities, which are equally important for businesses to run competently, must also be made available through reformed government policies.

2. Access to funding

One of the biggest challenges entrepreneurs face in starting out and scaling up, is adequate access to funding. Mostly, they depend on private investments and the unorganized financial sector where rates of interest are high. This reliance on the private moneylender is because the door to government funding is hurdled with unnecessary bureaucratic procedures. Serious policy initiatives, through increased transparency and separate allocation of funds, need to be taken so as to ensure that SME’s, the hubs of innovation, do not suffer because of the lack of funding.

3. Simplification of the tax regime

There needs to be significant simplification of the tax regime in India for ensuring faster growth in enterprises. To enable this simplification, a single-window system for various tax approvals should be created. Moreover, all state-level taxes should be incorporated under a single all-India tax system. This would generate uniformity and would allow a greater development of SME’s.

4. Reduce time taken to start a business

India’s ranking has continued to be one of the lowest in the World Bank’s ‘ease of doing business’ index. Due to various bureaucratic and legal hurdles, it takes at least 28 days simply to register a business in India, which calls for major improvements in this area. E-governance of all government and business interactions would remove the requirement of all unnecessary paperwork and could also combine both state and national level formalities, making it easier to start a business.

5. Flexibility of labour laws

Despite efforts made in this field, the inflexible nature of labour laws in India has constrained the growth of SME’s. Entrepreneurs spend a significant amount of time in training the work force they hire to suit the needs of the skill-set demanded. Policies must be reformed in order to focus more on skill development, which would also increase the employability of the labour force.