What key reforms did the government implement in 2025 to improve the ease of doing business?
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Synopsis
In a significant move to enhance the business landscape, the Ministry of Corporate Affairs rolled out vital reforms in 2025, making compliance simpler and governance stronger. These initiatives are aimed at making India a top business destination, providing much-needed support to entrepreneurs and investors alike.
Key Takeaways
- Increased thresholds for small companies to facilitate access to incentives.
- Revised KYC process to ease compliance burdens.
- Streamlined insolvency frameworks for enhanced governance.
- Integrated digital platform for faster investor claims.
- Establishment of new regulatory offices to improve oversight.
New Delhi, Jan 1 (NationPress) The Ministry of Corporate Affairs (MCA) implemented a series of pivotal reforms in 2025 aimed at streamlining compliance, bolstering corporate governance, and elevating the ease of doing business in India, as stated in an official announcement released on Thursday.
Among the reforms, the Ministry has increased the threshold for paid-up share capital and turnover to Rs 10 crore and Rs 100 crore respectively for small enterprises, thereby allowing more businesses to qualify for various government incentives and access to loans with ease.
Additionally, the Companies (Compromises, Arrangements and Amalgamations) Rules were revised in September 2025, broadening the scope for Fast Track Mergers and Demergers under the Companies Act.
Furthermore, the Companies (Removal of Names of Companies from the Register of Companies) Rules, 2016 have been updated as of December 31, 2025, simplifying the process for dissolving government-owned companies.
This revision stipulates that an indemnity bond concerning one or more directors appointed by the Central or State Government must be submitted by an authorized representative (not below the rank of Under Secretary or equivalent) from the administrative Ministry or Department of the Government of India or the State Government on behalf of the company.
The objective of this amendment is to facilitate the quicker dissolution of eligible government companies applying for name removal from the register as per section 248(2) of the Companies Act, 2013.
In line with the revised rules effective from March 31, 2026, the annual KYC filing requirement has been substituted with a more straightforward KYC notification every three years, significantly easing compliance for directors across all companies.
On August 12, 2025, the Insolvency and Bankruptcy Code (Amendment) Bill, 2025 was introduced in the Lok Sabha to shorten timelines, maximize value, and enhance governance. This bill also suggests frameworks for creditor-initiated insolvency, group insolvency, and cross-border insolvency, currently under review by the Select Committee of the Lok Sabha.
By September 2025, a total of 1,300 resolution plans were sanctioned under the Code, with creditors recovering Rs. 3.99 lakh crore, equating to 170.09% of the liquidation value and 93.79% of the fair value (based on 1,177 cases with estimated fair value). The average haircut for creditors relative to the fair value of assets was approximately 6%, while regarding their admitted claims, it stood at about 67%.
As a significant technology-driven advancement, a comprehensive digital platform for the Insolvency and Bankruptcy Code (IBC) ecosystem is currently being developed.
These reforms, especially the digital integration of the insolvency framework, are projected to enhance credit access for businesses, lower transaction costs, and ensure swifter and more predictable outcomes. Collectively, these initiatives reaffirm the government’s dedication to positioning India as a leading global hub for ease of doing business, according to the statement.
To assist investors, the Investor Education and Protection Fund Authority (IEPFA) launched an Integrated Portal and Dedicated Call Centre aimed at expediting claim resolutions and bolstering investor assistance. This portal merges MCA-21, NSDL/CDSL, and PFMS into a single automated process, shortening post-approval share and dividend transfer timelines from several months to just 1–2 days. Since its inception, more than 24,026 claims have been approved, raising the total approvals for the current fiscal year to 27,231.
These reforms have revolutionized the claims process into a fully digital, transparent, and investor-centric operation.
To enhance regulatory outreach and service delivery, the Ministry will establish three new Regional Directorates in Chandigarh, Navi Mumbai, and Bengaluru; and six new Registrar of Companies (RoCs) in Delhi, Mumbai, Kolkata, Noida, Nagpur, and Chandigarh, effective January 1, 2026. These offices have been created in response to the rapid increase in corporate entities and anticipated regulatory demands, as highlighted in the official statement.
Point of View
I affirm that these reforms reflect a proactive approach by the government to foster a conducive business ecosystem. The initiatives are poised to not only simplify processes but also to enhance investor confidence, reaffirming India's position on the global business map.
NationPress
01/01/2026
Frequently Asked Questions
What are the thresholds for small companies as per the new reforms?
The new reforms raised the thresholds for small companies to Rs 10 crore for paid-up share capital and Rs 100 crore for turnover, making more businesses eligible for government incentives.
How do the new amendments affect KYC requirements?
The annual KYC filing has been replaced with a simpler KYC intimation required once every three years, significantly easing compliance for directors in all companies.
What is the significance of the Insolvency and Bankruptcy Code (Amendment) Bill, 2025?
The bill aims to reduce timelines, enhance value maximization, and strengthen governance in insolvency processes, proposing frameworks for creditor-initiated and group insolvency.
How does the new Integrated Portal assist investors?
The Integrated Portal streamlines the claims process, integrating multiple platforms into one automated workflow, which reduces the time for share and dividend transfers from months to just 1-2 days.
What new offices are being established to improve regulatory reach?
The Ministry will operationalize three new Regional Directorates and six new Registrar of Companies across various locations to enhance service delivery and regulatory oversight.
