CII suggests 10-point agenda on EoDB reforms
In a continuously evolving competitive environment globally, coupled with rapidly changing geopolitical and economic conditions, sustained and speedy improvement in domestic business climate has assumed a high priority. While India has over the last decade remained focused on improving ease of doing business (EoDB), there is a need to maintain the momentum especially in certain specific areas.
Emphasizing the key areas of business reforms in the country, Mr. Chandrajit Banerjee, Director General, CII, said “Simplifying regulatory frameworks, reducing compliance burdens and enhancing transparency should continue to remain our focus agenda for next several years. Compliances for industry related to various areas such as land, labour, dispute resolution, paying taxes and environment offer a vast scope for reduction, vital for boosting competitiveness, driving economic growth and employment generation”.
The press statement issued by CII has underlined 10 specific EoDB areas where urgent policy interventions would be immensely helpful.
First, all regulatory approvals - central, state and local levels - must mandatorily be provided only through the National Single Window System (NSWS), which will help in bringing about transparency and speed in the processes. In the first stage, this should be completed for all central ministries within the next 6th months, followed by bringing on the platform, states, in a phased manner. A dedicated central budget could be allocated for the purpose, especially from the point of view of incentivizing states to shift completely to the portal.
Two, with a view to ensure timely processing of industry applications and delivery of services from the central ministries, an Act, imposing statutory obligation on all public authorities for time-bound delivery of services and redressal of grievances, could be passed, with provision of deemed approval beyond the prescribed timeline.
Three, expedite the process of dispute resolution through both improving the capacity of courts and placing greater reliance on Alternative Dispute Resolution (ADR) mechanism. States with a high pendency of cases need to set up more commercial courts while also working on increasing the efficiency of existing judicial system. Similarly, there is a need to encourage and promote the use of conciliation, mediation and Arbitration, which would, among other key measures, require allocation of central budget and establishing the Mediation council of India and Arbitration Council of India at the earliest.
Four, the scope of the National Judicial Data Grid (NJDG), which has been set up to identify, manage and reduce pendency of cases across the courts, needs to be expanded to include the data of tribunals, which constitute substantial chunk of pendency of cases in the system.
Five, for streamlining environmental compliances, a unified framework could be introduced, which consolidates all requirements into a single document. Relevant provisions of the Water Act, 1974, and the Air Act, 1981, can be incorporated into the Environmental Protection Act, 1986, to centralize air and water pollution regulations. A performance-based incentive system can also be established to recognize companies that consistently exceed environmental standards by offering expedited environmental/forest approvals, clearances and permits.
Six, easy access to land is important to facilitate new or expanding businesses. States may be incentivized to develop an Online Integrated Land Authority with an objective to streamline land banks, digitize & integrate land records, provide information on disputed land and guide necessary reforms. To assist industry in land acquisition across nation, the India Industrial Land Bank (IILB), which currently provides information on land across majority of states, can be evolved into a National Level Land Bank, with dedicated central budget support.
Seven, labour compliances continue to be extensive and arduous and await the implementation of the 4 Labour Codes. Also, scope of the Shram Suvidha Portal, which currently facilitates integrated compliances in just a few select central Acts, needs to be expanded to function as a centralized portal for all central and state labour laws compliances.
Eight, improving trade facilitation is important. There is a need to make the Authorized Economic Operator (AEO) programme, which allows numerous priority clearances to members, could be made more attractive and easier to join. Additional benefits could be in the form of increasing the period of deferred duty payment from 15 days to 30 days, simplifying the renewal process for AEO Tier 2 and Tier 3 by allowing renewals based on self-declaration and permitting MSMEs to join programme with 10 shipping bills in a year rather than 5 in each two halves of the year.
Nine, towards greater trade facilitation, allied legal metrology rules should be in syncwith International Organization of Legal Metrology (OIML) for declarations on retail products for imports. Further, imported Weights & Measures (W&M) equipment certified by OIML approved labs, with no alterations or modifications made before sale, should be exempted from additional Indian Model Approval.
Finally, high and rising pendency of tax disputes is a major issue and there is a need to minimize income tax litigation by unclogging the pendency at the level of Commissioner of Income Tax (Appeals) and improving the effectiveness of ADR mechanism such as Advance Pricing Agreement (APA), Boards for Advance Rulings (BAR) and Dispute Resolution Scheme (DRS).
11 January 2025
New Delhi