In a recent address to captains of Indian industry at FICCI, Mr Rahul Gandhi, Vice-President, Congress lambasted the ‘arbitrary’ powers enjoyed by an Environment Minister as major stumbling bloc in granting approvals to projects.
In this backdrop, it was not just a coincidence that the Union Minister for Environment & Forest, Ms Jayanti Natarajan submitted her resignation though this was camouflaged as being necessaited by the need to enable her focus on party work.
At a time when India is trapped in to a low GDP growth trajectory of less than 5%, projects worth Rs 10 lakh crores (US$ 160 billion) are pending clearance at the level of Minister despite approval already granted by environment appraisal panels.
Of projects worth Rs 14 lakh crores (US$ 224 billion) submitted to Cabinet Committee on Investment (CCI) – a panel of Ministers set up early this year to resolve procedural delays – and stuck due to bureaucratic red-tape (as on December, 2013), environment Ministry alone was responsible for delays in investment of Rs 500,000 crores (US$ 80 billion).
In a parliamentary democracy where policy decisions are the collective responsibility of the cabinet and Prime Minister is expected to spearhead all decisions, to lay the blame squarely on one department for any laxity or delays is un-tenable.
Timely environment approval (besides land acquisition) is a fundamental requirement for taking up timely implementation of projects. This is all the more critical for infrastructure/core projects viz., oil & gas, power, highways, coal, steal etc.
These sectors hold the key to rapid and sustained economic development needed for increasing income, employment and ensure better quality life for masses. Yet, India is riddled with huge shortages and inadequacies in these areas.
To overcome these, country needs investment of US$ 1 trillion in infrastructure alone during 12th plan (2012-13 to 2016-17). Of this, US$ 500 billion has to come from private sector. Without timely clearances, investments will simply not materialize.
These imperatives are so pressing that PM must keep these at the centre stage all the time. The progress of at least big projects say, US$ 200 million or more should be monitored on a regular basis at the level of Cabinet or its high level committee.
Yet, the very fact that projects were allowed to languish speaks volumes about utter neglect by Cabinet and not just by concerned administrative ministry. In this case, environment ministry alone cannot be held responsible.
CCI has sorted out around 100 projects – involving investment of Rs 300,000 crores (US$ 48 billion) – that required consultations between different ministries. Though, major hurdles are cleared, these will still have to pass through bureaucratic maze.
No doubt, inter-ministerial differences/wrangling – that CCI has attempted to sort out – often lead to protracted delays. But, a fundamental reason for delays is ‘archaic’ procedures that India inherited from ‘British raj’.
More than 6 decades after independence, these have remained in tact despite liberalization and reforms especially since 1991 and over-riding need to grant approvals on ‘fast track’ to ensure that our industries remain competitive in the global market place.
Typically, procedures involve movement of ‘file’ to multiple layers within bureaucracy. Any letter from a company CEO to Secretary in a Ministry (highest functionary next to Minister in-charge) moves down to Joint Secretary (JS), Director/Deputy Secretary (DS); under-Secretary (US) and finally to section officer (SO).
SO assembles relevant papers and dispatches them to US who after necessary vetting (and remarks) forwards to Director/DS. The latter puts up a ‘note’ – after required analysis & scrutiny – to JS. JS in turn, puts up to Secretary with his recommendation/suggestions.
All these notes are on files – mostly hand written. One way movement of files to last destination may take several days, or even months. Ditto for movement in reverse direction. Transportation of files from one room to another in corridors of any Ministry is a fascinating scene to watch most of the times!
In a situation where an important change is triggered at the level of Secretary – either on his own volition or instruction from the Minister or CEO sends a fresh letter/representation – required processes & notes at different layers get repeated.
Don’t forget infamous ‘dispatch’ section. This is the most vital interface between any Ministry and industry/public as also other ministries/departments. The possibility of papers getting stuck in this section for unpardonably long periods is not ruled out.
All ministries & departments of Government suffer from the same syndrome. Now, contemplate a project that requires co-ordination and approval by at least half a dozen Ministries/departments, cascading effect of delays in each could be palpable.
We are in the age of information technology (IT). Government too has embraced this in a major way. Its effective deployment can enable fast communications. It is possible to minimize delays drastically. Yet, procedures and processes remain stuck in old age.
Indian political establishment is not tired of exhorting management in private sector – and public sector undertakings (PSUs) in both centre and states – ad infinitum – to improve efficiency in their working and speed in decision making.
Yet, when it comes to its own working, efficiency and speed considerations are put on the back burner. Corruption that permeates almost every segment of administrative set-up aggravates these maladies. Inefficiency and corruption feed on each other.
Much ado is made about ‘Citizens Charter’ bill now pending in Parliament which its protagonists believe help in reducing delays by way fixing timelines and penal provisions for ensuring compliance. However, given ‘archaic’ procedures, it is impossible to prevent delays!
All along during a decade of ruling dispensation UPA I & II, good governance has been at a huge discount even as inefficiencies and nepotism in system has proliferated. The recent spate of steps to combat these maladies including passage of ‘Lok Pal’ bill are more in response to drubbing received by Congress in recent assembling elections. These are prompted primarily by the fear of suffering a huge setback in impending General elections and are far from reflecting a genuine commitment to stem the rot.
Whether or not reforms are sustainable and extant ‘archaic’ procedures will be dismantled? The picture will be clear only by mid-2014.