The Indian government has formed a task force led by the Cabinet Secretary to simplify rules and reduce compliance burdens across sectors and states. The aim is to create a better regulatory environment that will attract more investment to the country.
They’ve identified eleven ministries, including the ministries of environment and corporate affairs, as having the most cumbersome regulations. Some states have also been highlighted for their excessive compliance requirements.
To tackle these issues, more than a dozen Union ministry secretaries have been assigned to work with specific states. Their goal is to help deregulate these areas and get stalled priority projects moving again. Soon, the Cabinet Secretary will meet with chief secretaries from the states facing these challenges due to heavy compliance.
Additionally, a ‘Deregulation Cell’ has been established at the Cabinet Secretariat. This cell aims to create a focused approach to reduce compliance burdens both at the central level and in the states.
The task force, set up on January 24, includes key officials from various government departments. In its first meeting, they discussed how regulatory requirements are slowing down projects. Simple permits, like fire certificates and utility connections, alongside more complicated processes like environmental clearances, are causing delays and raising costs. Some states are seeing compliance costs exceed ₹600 crore, with land allotment delays over 170 days.
Despite a ₹14 lakh crore allocation for infrastructure development, such projects won’t succeed if regulatory obstacles remain. This task force was established after the 4th national conference of chief secretaries, where “systematic deregulation” was emphasized.
To attract investments and create jobs, urgent reforms are needed in areas such as regulations on women’s employment, high electricity costs, and complex land use rules. Examples of restrictive standards include separate zoning laws for residential and industrial areas and complicated licensing processes. These barriers hinder growth but can be addressed with proper deregulation.
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