Wintrack exit sparks debate on ease of doing business, exposes ranking-reality gap

US-based logistics company Wintrack Inc’s decision to cease all import-export operations in India from October 1 over alleged “harassment” by Chennai Customs, and the emergence of similar stories shared by entrepreneurs in the wake of the announcement, have sparked a raging debate on the structural hurdles that ail businesses in India, despite the government’s claim of an improved business climate.

What prompted Wintrack’s exit?

Announcing its decision in a statement on X, Wintrack Inc said its exposure of bribery practices twice this year triggered retaliation that crippled its business.

“Effective October 1, 2025, Wintrack Inc will cease all import and export operations in India. This difficult decision comes after repeated and unjustified harassment by officials at Chennai Customs over the past 45 days. Earlier this year, when we exposed instances of bribery, we faced retaliatory actions that have severely impacted our ability to conduct business. Despite our best efforts, the sustained pressure has made it impossible to continue operations,” the post read.

Also read: Wintrack shuts India ops over Chennai Customs' 'harassment'; govt agency rebuts claim

The post went viral, clocking 5.8 million views, 7,900 retweets, and 2,000 comments, with many entrepreneurs pouring in their own accounts of customs delays and alleged corrupt demands.

Ease of doing business: rankings vs reality

India has made gains in improving its business climate, but continues to face deep structural hurdles. In the World Bank’s Logistics Performance Index (LPI) 2023, India ranked 38th out of 139 countries, climbing six places since 2018. The jump reflects stronger infrastructure and faster shipment times, but the country still lags behind China (19) and most advanced economies.

At home, the government points to the Business Reforms Action Plan (BRAP) 2024, which claims to have eliminated over 39,000 compliance requirements and decriminalised more than 3,400 provisions. These steps, officials say, are aimed at reducing harassment and creating a more predictable environment for investors.

Yet as the Wintrack episode shows, for many firms the day-to-day experience remains mired in bottlenecks, unpredictable clearances, and the risk of arbitrary enforcement.

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But it wasn't always bad news. In 2020, India was listed 63rd out of 190 economies in the World Bank’s Ease of Doing Business index (as of the last report in 2020, before the index was discontinued). Between 2014 and 2019, India jumped 79 spots, from 142 to 63, a surge attributed to digitisation, streamlined approvals, and insolvency reforms.

But in the last few years, despite the surge in digitisation, businessmen say there's still day-to-day friction faced by businesses on the ground.

A July 2025 report by the Confederation of Indian Industry (CII) underlines this mismatch. Despite reforms, businesses still navigate a regulatory maze of 1,536 Acts, 69,233 compliance conditions and over 6,600 filings. CII recommends binding timelines for approvals, a legislated National Single Window System for all permits, risk-based inspections, and fully digitised, zero-paper customs clearances powered by AI.

Finance Ministry responds

The viral backlash prompted a formal statement from the Union Finance Ministry. It said a senior Department of Revenue (DoR) officer had been deputed to conduct a “fair, transparent and fact-based inquiry.”

The ministry also pointed to “taxpayer-friendly” reforms like the Taxpayer Charter, faceless customs procedures, and appellate bodies for dispute resolution, reiterating that the government is “committed to enhancing ease of doing business”. The ministry intervention happened on October 2.

Also read: Govt orders inquiry into Wintrack's allegations of 'harassment' by Chennai Customs

But on October 1 itself, Chennai Customs struck back, rejecting Wintrack’s allegations as “false and calculated.” In a detailed rebuttal, the agency claimed Wintrack misclassified goods, failed to declare USB charging cables containing rechargeable batteries, and provided improper documentation. Officials alleged that the importer “attempted to intimidate senior officers through threats of media exposure and self-harm” when due process was explained.

“We categorically state that every action taken was legally mandated, procedurally proper, and based on documented violations discovered during examination,” Chennai Customs posted, insisting no bribes were demanded.

While some online commenters felt that Chennai customs may be right in its stance, as Wintrack's website seems "thin on details, networks and clients,"; still many voiced the opinion that the larger point remains; customs officials for long have hampered businesses with their bribery and corruption.

Politicians, industry experts weigh in

The incident drew strong reactions across the political and business spectrum. Shashi Tharoor, Congress MP, posted on X: “This is truly dismaying. Corruption remains rampant across the system and most companies simply comply as part of the ‘price of doing business’. It doesn’t have to be this way. Indeed it must not be like this if the country is to grow and prosper.”

Also read: Chennai Customs officer yanks passenger’s thali; Madras HC calls it intolerable

Mohandas Pai, Infosys’ former CFO and startup investor, lashed out at the government: “Madame @nsitharaman this is not acceptable. You have failed to stamp out systemic corruption in our ports… Rs 30 lakh crore stuck up in tax disputes. We need a bribe-free, hassle-free system with better rules.” Pai later acknowledged the ministry’s quick response but stressed that “this is about corruption and bribery, not classification issues.”

Jacob Crasta, an industrialist and member of the Peenya Industries Association, told The Federal, “The ease of doing business needs to improve. Industrialists are at the receiving end of poor infrastructure, endless delays and corruption.”

Stories from the ground

The Wintrack episode unleashed a flood of testimonies from entrepreneurs who say the system is stacked against them. Ravi Pachaiyappan, a veterinarian and founder of Augie Pets, posted on X: “One shipment took us 9 months plus to clear customs and AQCS clearance… The head of AQCS told me, ‘so what?’ even after we followed procedures.” Another entrepreneur Yogesh Goel posted, “This is what happens when you expose bribery. All departments make sure you’re screwed. Bribery is the only ease of doing business in India.”

Another X user Viktor, who had worked on a defence PSU shipment, was blunt in his post: “Customs are so shameless and corrupt they blocked even defence shipments! Had to threaten PMO involvement to get clearance.”

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Such accounts point to a deeper trust deficit. As one exporter put it privately: “Even if paperwork is perfect, your consignment can sit indefinitely if you don’t pay. If you protest, they’ll find ways to delay it further.”

Government’s push for reforms

To its credit, the government has pushed significant digitisation. Customs filings can now be done online, faceless assessments are standard, and “Green Channel” clearances for low-risk cargo have expanded. The Time Release Study (TRS) published annually shows average cargo clearance times falling from over 80 hours in 2017 to around 44 hours in 2023.

Yet, as CII warns, last-mile enforcement remains unpredictable. Approval systems remain fragmented across central and state bodies, grievance redressal is opaque, and compliance regimes vary widely. The CII report urges a move toward self-certification and third-party audits to cut discretion, and consolidation of environmental, battery waste and metrology rules into a unified framework.

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India’s export-import trade is growing rapidly: in FY 2023–24, merchandise exports hit $778 billion, up nearly 67 per cent from a decade ago. Policymakers hope to push this to $2 trillion by 2030. But logistics and customs inefficiencies remain chokepoints that could undermine competitiveness.

Wintrack’s exit may not immediately dent trade volumes, but it damages India’s image at a critical moment. As global supply chains diversify away from China, investors and manufacturers are looking for reliable alternatives. Episodes of alleged harassment risk sending the opposite signal.

As Tharoor warned, “It doesn’t have to be this way.”