Context:
Recently, according to a report released by The Economic Times, Uttar Pradesh has overtaken Delhi in terms of registration of new companies during the current financial year (2024-25).
- Uttar Pradesh has emerged as the new hub of the country to start business, as between April 2024 and January 2025, 15,590 new companies were registered in Uttar Pradesh, while 12,759 new companies were formed in Delhi.
- At the same time, Maharashtra is at the top with the registration of 21,000 companies.
- Also, the rapid pace of industrial development of Uttar Pradesh has overtaken West Bengal, Tamil Nadu and Karnataka.
- With a favorable environment for business and increasing confidence of investors, Uttar Pradesh has become the third largest business hub in the country.
UP lags in the number of active companies
- At present, Uttar Pradesh may be ahead of Delhi in the number of starting businesses, but Delhi is still ahead in the number of active companies.
- As of January 2025, 1.50 lakh companies were active in UP, 2.50 lakh in Delhi, and 3.46 lakh in Maharashtra.
- As of November 30, 2024, a total of 1,12,962 companies were registered in Uttar Pradesh during the current financial year 2024-25.
Reason for attraction of new companies towards the state
- Uttar Pradesh’s population of more than 24 crores is a major strength of its development. About 55-56 percent of the state’s population is of working age, due to which the business does not face shortage of customers and workers.
- The state government is also promoting new sectors along with traditional agricultural industries so that the state’s fast growth rate remains.
- This is attributed to various government initiatives of the state aimed at simplifying the registration process and promoting entrepreneurship.
- Better law and order and easy business rules in the state have led to the rapid growth of business.
- Noida being a major industrial hub is also attracting investors.
- The economy of the state is continuously getting stronger. The state’s growth rate from 2021-22 has been between 7.5-11.4 percent, which is higher than the national average.
- The current rapidly changing global scenario has also attracted new industries to Uttar Pradesh.
In the last financial year 2023-24, 1,85,312 companies were incorporated in India, with Maharashtra’s share in these new entities being 17.6%. This steady growth highlights the country’s dynamic business environment and growing confidence among entrepreneurs.