Overcoming Compliance Challenges: How India’s Socialist Mindset Impacts Business Regulations – Insights from Kant

Amitabh Kant, India’s former G-20 Sherpa, recently spoke about the heavy burdens regulations place on Indian businesses. At an event called Excellence Enablers, he expressed concern that the country’s “socialist mindset” still hampers progress.

Kant pointed out that India’s regulatory environment resembles the old “licence Raj” from British rule. He stressed the need to lift these heavy compliance requirements to help businesses thrive. He suggested that regulations should serve as a shield for trust and transparency, rather than a tool for unnecessary control.

He argued that regulation should promote innovation and job creation, essential for achieving India’s ambitious goal of a $30 trillion GDP under the Viksit Bharat initiative. “We need to transform the role of government from being controlling to being enabling,” Kant said.

His suggestions include creating an “impact assessment” system for financial regulators to evaluate the effects of their decisions regularly. He also warned against concentrating too much power in one regulator, which could lead to conflicts of interest.

Kant believes that Indian regulators should operate in three stages: rule-making, enforcement, and adjudication, ideally with independent tribunals to handle cases. He welcomed the current public consultations in the regulatory process but pointed out the need for these bodies to delegate some of their authority.

Additionally, he proposed implementing a “sunset clause” for regulations, meaning they should either be terminated or reviewed after a certain period. “For India to grow, we need innovation and freedom. Our regulations must enable growth, not stifle it,” Kant concluded.

The conversation is timely, especially considering a recent survey showed that over 60% of Indian entrepreneurs view regulatory compliance as a major hindrance to business growth. By shifting the regulatory approach, India could unleash a wave of creativity and economic expansion.

For further insights on India’s regulatory challenges and potential reforms, refer to the Economic Times for detailed coverage and expert opinions.



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