Among all States, Kerala stood at position 28 in the Ease of Doing Business rankings in 2019. By 2022, it had climbed to 15, thanks to considerable work on the parameters of evaluation.

After 2023, Niti Aayog stopped assessing or ranking States. Kerala continued its efforts to improve the business environment and attract capital. Though ideologically opposed to global capital, the LDF Government’s Industry Minister and officials travelled to Davos to attend the World Economic Forum, an exclusive gathering of multinational corporate leaders. The Government was equally pragmatic towards Indian corporates. At its annual investors’ meets, it invited groups such as Adani and Ambani, promising smooth approvals. Pragmatism prevailed over praxis. The former Industry Minister and Chief Minister deserve credit for putting development (vikasanam) above ideological rigidity.

Yet Kerala has delivered little on deregulation. While some reforms involve new initiatives, deregulation means dismantling restrictive policies that have outlived their relevance. Several reforms announced in the State budget never took off because of opposition from alliance partners. Even amendments or repeal of the Land Reforms Act of 1963 have been recommended by a group of bureaucrats (Beyond Cynicism: Kerala 2.0, edited by T Balakrishnan and the late P H Kurian).

The then Finance Minister, K N Balagopal, in his budget speech for 2022-23 announced that intercropping fruit crops would be permitted by amending the Land Reforms Act, 1963. Rubber plantations could grow rambutan, dragon fruit and mangosteen, improving farm incomes and rural returns. A proposal to allow foreign universities to establish campuses in Kerala met a similar fate, opposed by Left-aligned parties and pressure groups.

Kerala’s resistance to wider highways is another reminder of how development gets held hostage to entrenched positions. The Oommen Chandy Government eventually accepted 45-metre-wide national highways in 2014, reversing the earlier 30-metre proposal. All political parties in consensus recommended that 30-metre highways are enough for Kerala.

The State’s business framework needs much more deregulation. These steps alone could help attract investment and make Kerala genuinely investor-friendly. The widespread perception is that Kerala is a high-wage island, intrinsically pro-labour, whether the employer is a provision store owner or a small restaurant. During all-India strikes, shops and hotels are shuttered, and even patients travelling to the Regional Cancer Centre or Government Medical College Hospital may need police vans. In Chennai, Mumbai and Delhi, life often goes on normally.

A friend who ran a stationery business in Thiruvananthapuram told me that the cost of unloading and stacking goods locally equalled the entire expense of loading and transporting them from Sivakasi/Madurai to the capital. He eventually shut shop and moved to Tirunelveli.

Entrepreneurs in North Kerala say incremental investment is moving to Tamil Nadu and Andhra Pradesh, where governments make businesses feel welcome. Kitex’s move to Telangana, following repeated raids by State agencies, is already well documented.

Another example is the Paddy and Wetlands Act, notorious for obstructing conversion of even tiny plots within residential complexes. Former Union Secretary Mohandas wrote in Malayala Manorama (September 22, 2026) that such delays can last two or three years.

In commenting on this article, another former IAS officer recounted how his sister’s land conversion application in Tripunithura remained pending for years. He alleged that officials demanded money through political intermediaries. He told his sister not to yield, but the approval is yet to come. Such experiences reinforce perceptions of bureaucratic delay and corruption.

The recent floods, a smaller recurrence of 2018, also raise questions about river dredging and dam maintenance. A ₹500-crore dredging package announced in the 2021-22 budget by Dr Thomas Isaac has remained on paper. Dredging could improve river flow and make sand available for construction, reducing dependence on M-sand.

I too have a personal example. My brother sought conversion of six cents of land (from wet to garden land )within a residential complex at Kakkanad, Ernakulam, before selling it. He was told the process could take at least two years. A property sale, stamp duty revenue and a house construction project are thus stalled. The real estate experts say that house construction supports demand across 200 sectors with cement, steel, wood, switches, plumbing pipes, nails, tiles, marble/granite blocks, etc.

His request is seemingly moving now only because TV Subhash, IAS, Special Secretary in the Agriculture Department, agreed to follow up. His responsiveness to a citizen’s grievance stands out. Most bureaucrats would not even reply to messages for help on their registered government-funded phones. It is such small nudges and pushes which will ease the process of doing business if Kerala has to grow even its services sector.

Kerala has to approach the subject of the ease of doing business and deregulation seriously. Outdated legislation must be dismantled. That would be creative destruction. The new State Government has to move fast in taking up this work seriously. Old shibboleths must give way if the State is to unlock investment, jobs, economic growth and government revenue.