Economic Survey 2018-19 calls for improvement in contract enforcement regime

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  1. According to the Economic Survey 2018-19,contract enforcement remains the single biggest hurdle to improve India’s ease of doing business ranking.
  2. India has climbed to 77th position in the World Bank’s ease of doing business ranking that captured the performance of 190 countries.
  3. The Ease of Doing Business assessment provides objective measures of business regulations and their enforcement across 190 economies on ten parameters affecting a business through its life cycle.
  4. Among various indicators,India’s worse performance was highlighted in enforcing contracts where the country ranked 163rd in 2018.
  5. The survey says that the solution is to improve the judicial system, particularly in lower courts where 3.5 crore cases remain pending.The survey said two key issues need to be dealt with in order to make the judiciary more efficient and to clear the ‘legal logjam.’
  6. Firstly,the courts must achieve a 100% case clearance rate(CCR) so that there is zero accumulation to the existing pendency.CCR is the ratio of the number of cases disposed of in a given year to the number of cases instituted in that year.
  7. Secondly,the backlog of cases already present in the system must be removed.District and Subordinate (D&S) courts which account for the bulk of pendency received 1.5 crore additional cases in 2018 and had a backlog of 2.87 crore as on January 1, 2018.
  8. The survey has also suggested (a)improving the efficiency of the courts, (b)increasing number of working days of courts (c)establishment of Indian Courts and Tribunal Services and (d)deployment of technology in the legal system.