Praveen Kumar
Table of Contents
India is one of the fastest-growing economies in the world, it has a lot of potential and has shown great development in various fields like the IT sector, space, and automobiles. India is targeting to be a developed nation before 2050, but this target seems impossible and I will explain everything in detail about why starting a business is so hard in India.
Why Starting a Business is So Hard in India
Corruption
Every country has corruption up to some level but India is on a different level even a simple clerk here will demand thousands of rupees to get a single signature done in India. Let’s understand this with a simple example, to open a hotel you need around 50-100 permissions from different government officials.
At every step, they will demand higher and higher amounts just to approve your requests like land acquisition, no objection certificate (NOC), and many more and if you refuse to pay them, your document will be stucked forever.
Unjustified Tax System
The Indian tax system is unjustified in every possible way, first of all, everyone has to pay GST on every product and that varies from 10-30% even education and healthcare are no exceptions to GST, on books we have to pay 18% GST.
If you buy a car in India you have to pay GST 30%, CESS 20-30%, road tax, RTO charges, and insurance tax 18% these taxes would be more than the actual price of the vehicle itself and in the end, you need fuel to run your vehicle, and you have to pay more then 100% tax on GST.
Leaders in India can increase taxes on anything without thinking about consequences, this is because of democracy, they are given so much power without any accountability, and they can blame each other if something goes wrong because of their decision.
Also Read: How to Start a Profitable Dropshipping Business in India
Lack of Skilled Labourers
India produces engineers equal to the population of Switzerland every year but still, Switzerland is better at research and innovation and India is nowhere in the list. This is because of a lack of education, the Indian education system is designed to produce workers, not research and innovation.
Even higher institutions and just talk and no brain, the most prestigious engineering institutions IITs, NITs, and IISc are now just a gateway for students to get a high-paying job. No research and innovation. and you know what the worst part is? when someone donates to these prestigious institutions for research and innovations, the government will tax 30% of the total donation amount.
So, if you are an entrepreneur or business owner you will find it very difficult to get skilled employees for your business. Most businesses have to spend money on training their employees first before they are ready to start the actual work.
The government spends barely any money on the development and betterment of the education system. This is also one of the reasons why no one wants to send their child to government schools, there are no properly qualified teachers in government schools.
India spends only 4% of its GDP on education which is a lot less than they spend on elections. In reality, the government really doesn’t care about its people, they just want to be in power as long as possible.
Politics
In India politics is involved in everything directly or indirectly, even educational institutions, and no exceptions if someone is doing PhD from an institute he has to publish his thesis on topics already decided by the government like government welfare schemes and many more which clean the image of government.
This is the reason why people who can afford higher education go outside India also known as brain drain. and they have no reason to come back.
Any business you want to start in India, if you have direct connections with local politicians your work would be done within a few days you just have to pay them some money (bribe). and if you try to go against the local leaders, your business will be destroyed in no time.
So-Called Democracy
India is the biggest democracy in the world which simply means unlimited powers with no accountability, this is the biggest curse to our country, here everyone from a local clerk to the prime minister everyone has unlimited powers with no accountability.
This means they can do anything and they don’t have to answer anyone if something goes wrong. This is the reason why when you complain about any government official nothing actually happens. and ultimately you have to rethink your decision. You can read here how a CEO regrets starting a business in Bihar India
My Personal Experience
A few days ago my friend had to get some documents to fill out her scholarship form, she applied for those documents online about 30 days ago and they said it would arrive in 15 days, and even after 30 days the document didn’t arrive. We went to the DC office to get everything manually.
We had to get 3 signatures and for that, we spent 2 days and even after that, she didn’t get her documents. There were no faults in the document, they were just not doing their job on time that’s why it was getting late. Now who is accountable for this crap, whom to blame, and where we can complain? nowhere even if we complain nothing would happen.
