Ease of Doing Business: Working in Delhi more money-making than Mumbai

The Ease of Doing Business analysis is based on a survey that established a comparision between the earnings and working conditions of 19-year-old cashiers in supermarkets that employ 60 workers across 190 countries.

Ease of Doing Business: Working in Delhi more money-making than Mumbai

New Delhi: While working as an employee or employer, wages and offs are the two major factors that matters the most.

A survey report revealed, working in Delhi is more remunerative than Mumbai. But if you are an employer, you may prefer to be in country's financial capital due to value added by workers being higher than the wage. But, national capital may provide you with fewer days off than Mumbai.

India has risen to 100 from 130 in the Ease of Doing Business rankings, released by World Bank on Tuesday. The rising economy was also rated among the top 10 countries in terms of improvement in the business climate. The rise was attributed to a number of systemic reforms taken over the past three years.

The Ease of Doing Business analysis is based on a survey that established a comparision between the earnings and working conditions of 19-year-old cashiers in supermarkets that employ 60 workers across 190 countries. The two cities surveyed in India were Delhi and Mumbai.

Below are the key highlights of the survey report.

  • The report shows that a cashier in Delhi supermarket is sanctioned to a monthly minimum wage of USD 217.6 a month (Rs 14,000 aprroxiamately).
     
  • Above figure turns out to be over 60 percent higher than the Rs 8,650 per month, earning of similar worker with a year's experience in Mumbai.
     
  • Payment of higher wages may compensate for more working days for workers as Mumbai serves 21 annual paid leaves while Delhi provides only 15.
     
  • Considering the supermarket's point of view, ratio of the cashier's minimum monthly wage to the value addition per worker was more favourable in country's financial capital.
     
  • World Bank's estimates shows, in Delhi value addition by worker is roughly equal to the minimum wages while in Mumbai wage is only 60 percent of the value added.
     
  • Mumbai, when compared to several other developing countries (such as Mexico City($152), Vietnam ($168) and Kuwait ($199)), seem to have much lower wages.
     
  • Delhi is more expensive than Shanghai, Bangkok, Jakarta, Kuala Lumpur and Manila.
     
  • Recent rise in wages in China works as a magnetic attraction for companies that operate large factories to other countries in regions including Vietnam, Cambodia and India.

Additionally, finance minister Arun Jaitley hailed the World Bank report and said ongoing measures will further improve India's ranking. "The country has made a 30-point jump. A number of measures implemented were not considered this time. In the next report, these and the ongoing work-in-progress will ensure India's ranking improves further.

The 190-country ranking, which is run by the World Bank Group, saw India make significant improvements in the availability of credit (ranked 29 vs 44 last year), protection of minority investors (ranked 4 vs 13 last year), tax compliance (119 vs 172), enforcement of contracts (164 vs 172) and insolvency (103 vs 136). Other major factors that drove India’s upward movement on the list included the user feedback system put in place by the Centre and reforms in the corporate income tax and EPFO.

Registering property (154 vs 138), getting electricity (29 vs 26) and trading across borders (146 vs 143) were some of the areas where India fared worse compared to the last ranking.

The ranking saw India as being among the 10 most improved places to do business. The other nine countries on this list (in particular order) were Brunei, Jerusalem, Thailand, Malawi, Thailand, Kosovo, Zambia, Djibouti and El Salvador.

The Doing Business report also noted that growth in small and media enterprises (SMEs) is the only way for India to create enough jobs.

In last year’s ranking, India had risen 25 places in the availability of electricity, from 51 to 26th position. The other significant improvement last year was in contract enforcement, where it rose to 172 from 178.

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