The Comptroller and Auditor General of India has launched an audit of the reforms adopted by states and UTs to enhance the ease of doing business for the micro, small, and medium enterprise (MSME) sector.

The pan-India horizontal audit spanning various states seeks to assess the effectiveness of states and Union Territories in executing reforms that enhance the business climate for MSMEs, which are vital to India's economic growth.

The audit will evaluate if MSMEs obtain effective, clear, and prompt services from public agencies. "It will assess the advancements in streamlining regulations, digitizing procedures, and decriminalizing petty offenses that impact businesses," stated Pravir Pandey, Additional Deputy CAG (Railways), during a discussion.

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This effort corresponds with national goals like Viksit Bharat @2047 and the Business Reform Action Plan 2024 led by the Department of Promotion of Industries and Internal Trade, he stated.

Earlier this year, Sanjay K Murthy, the Comptroller and Auditor General of India highlighted the strategic change in CAG's methodology transitioning from standard financial and compliance audits to assessing results and the impact of reforms.

Murthy instructed state accountants general to adopt a unified audit strategy that combines different aspects of governance, service provision, and regulatory effectiveness for an all-encompassing evaluation.

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Providing specifics, Pandey mentioned that the audit will evaluate if MSMEs obtain effective, clear, and prompt services from government entities.

It will assess the advancements achieved in streamlining regulations, digitizing procedures, and decriminalizing minor offenses impacting businesses.

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"The activity will also assess the influence and efficiency of significant MSME programs and the use of public funds. Moreover, the national reach will facilitate comparisons between states, encourage the implementation of best practices, and enhance the overall reform environment," he stated.

The audit is under the coordination of Manish Kumar, Principal Accountant General of West Bengal, acting as the Lead Audit Office for all 32 states/UTs.