REGULATORY REFORM IN INDIA -
A Discussion on the Draft Regulatory Reform Bill
New Delhi, India, August 3, 2010
CUTS organised the
9th Parliamentarians? Forum on Economic Policy Issues (PAR-FORE)
meeting in Dy. Chairman Hall, Constitution Club, New Delhi on
August 3, 2010, PAR-FORE has been an initiative of CUTS to bring
Members of Parliament (MPs), cutting across party lines, on a
single platform to mull over the core economic policy issues
that come up for discussion in and out of the Parliament.
?In India, the
approach to regulation is ad-hoc. The purpose of the draft
regulatory reform bill is to bring in uniformity in various
approaches to regulatory reforms in India. In order to ensure
effective adoption of the regulatory reform bill, some key
building bloc issues should be clarified. They are functional
and financial independence of regulators, accountability and
clear definition of the role of regulators and line ministries,?
said Rajeev Chandrasekhar, MP (Rajya Sabha). He was speaking at
a Parliamentarians? Forum on Economic Policy Issues (PAR-FORE)
organised by CUTS International to discuss the draft regulatory
reform bill developed by the Planning Commission. A number of
parliamentarians and regulators participated in the discussion
held yesterday at the Constitution Club in New Delhi.
discussion, Pradeep Mehta, Secretary General of CUTS
International mentioned that the bill lays down a cohesive
approach to regulation. There are several common factors such as
independence, accountability, which needs to be universal. The
bill does not suggest setting up of a super regulator, neither
that it undermines the role of the existing regulators but it
aims to simplify the process of regulatory reforms in India.
While presenting the
bill before the meeting, Gajendra Haldea, Advisor to the Deputy
Chairman of the Planning Commission emphasised that the draft
bill is being presented in the public domain for eliciting views
on the nature and extent of legislative action necessary for
reforming the regulation of key infrastructure sectors in India.
He requested all the stakeholders to submit detailed comments on
the provisions of the bill, which will be considered while
Dr. E. M. S.
Natchiappan, MP (Rajya Sabha) suggested that the bill should be
looked as a procedural law, which should specify various
parameters on issues such as appointments, independence,
accountability in order to bring in harmony across the
regulatory regime in India. K. N. Singh Deo, MP (Lok Sabha)
argued that the proposed bill should not undermine the role of
the states in delivering its assigned functions. Yashwant Bhave,
Chairman, Airports Economic Regulatory Authority (AERA) of India
suggested that ?one-size-does-not-fit-all? approach to reform
the regulatory regimes in India will not succeed as issues and
challenges differ from sector to sector.
It was debated that
for the Indian economy to achieve and sustain a high rate of
growth, the creation of quality infrastructure is critical. It
is estimated that India needs more than a trillion dollars of
investment in infrastructure. It was highlighted that such a
large magnitude of investment cannot come from the public sector
alone. The private sector will have to be persuaded to invest
more. It is in this context that the markets are to be regulated
optimally so that non-market risks are minimised through a
predictable legal environment.
Other MPs present
were Ashok Ganguly, Bhatruhari Mahtab, and Anup Kumar Saha.
Among others, Dhanendra Kumar, Chairman, Competition
Commission of India, Pramod Deo, Chairman, Central Electricity
Regulatory Commission, Ravi Mital, Adviser (Infrastructure) of
the Planning Commission, and Ashish Khanna of the World Bank
were present and spoke on the subject.