Telangana goes for revolutionary right to clearance policy for industries

Businesses get the right to know why proposals are being delayed and automatic okay while officials are fined for delay

GN Bureau | June 15, 2015


#telangana   #industrial policy   #right of clearance   #rti   #business   #chandrasekhar rao  


What has been termed as imaginative and somewhat bold, the Telangana government’s maiden industrial policy comes with a unique feature — Right to Clearance for industrial projects, which will function on the lines of Right to Information. For every day of delay in clearance of project application, the state will impose fine of Rs 1,000 on the officials.

The Right to Clearance is intended to convey a message that the government is determined to create an ecosystem in which ease of doing business “matches and even exceeds the best global standards”. It enables an applicant to know the reasons for the delay in clearance.

This feature, along with the government’s policy of “minimum inspection, maximum facilitation”, with single-window clearance and automatic renewals, besides encouraging self-certification, has caught the attention of the captains of industry.

The Telangana government claims that no country has such a policy.

Akin to the Right to Information, the Right to Clearance recognises that businesses have the right to know why project proposals are being delayed and to demand redress for unnecessary procrastination. Bureaucratic red-tape and corruption have not really come to an end in India despite the death of licence raj; industries are still at the mercy of whimsical policies and procedural nightmares.

The Right to Clearance will involve a provision to impose a fine of Rs.1,000 on officials for each day of delay in granting clearance to a project.

 It also lays down a 15-day time limit for the clearance of mega-projects involving over Rs.200 crore, and of one month for smaller projects.

If government departments miss the deadline, the project will get automatic deemed approval. These, and other features such as single-window clearances, automatic renewals and self-certification, will go a long way towards creating an ecosystem that eases doing business in the State.

The opportunity costs of clearance delays are enormous. Such cost and time overruns impact the viability not just of industries but also of lending institutions. Across the country, projects worth crores of rupees are mired, awaiting clearance.

This has been welcomed by leading industrialists.

Chief Minister K Chandrasekhar Rao has assured industry of “a graft-free and hassle-free system” that will remove lobbies and middlemen.

How this move that empowers industries will force other states to match the facilities to attract investment.

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