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Thursday, 08 May 2014 02:26
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Several states have found answers to vexing problems

Given the large number of stuck projects, especially over land acquisition, as well as the frequent complaints about red tape, it is difficult to come up with easy solutions. One of the USPs of the National Investment and Manufacturing Zones (NIMZ), for instance, was that units located in it could look forward to a single-window clearance for the multitude of approvals required right now—70 laws and 100 returns, that needed to be filed annually, were the numbers mentioned at that time. Given their large costs, and the difficulty in procuring land for NIMZs—particularly after the new land acquisition law—setting up NIMZs just to get faster clearances was always a bad idea.

A new study by the industry ministry, based on analysis done by various consultants such as Accenture, however, has some heartening news. Whether it is bad labour laws or tough land acquisition rules, the industry ministry points out, various state governments have already come out with solutions that are robust and have delivered over a period of time. Maharashtra’s Labour Management Solution, for instance, has created a one-stop shop for implementation and integration of 46 labour laws. While it took 10 days for units to get a licence earlier, it now takes just half a day. In the case of land acquisition, a tough job even before the new land acquisition law was put in place, Gujarat’s Investor Facilitation Portal has a live inventory of land availability and a system to help identify land for potential investors.

In each case, as the industry ministry points out, technology has played a critical role, as well as a nodal officer to drive the scheme. For now, if other states are to adopt similar schemes, there is obviously a lot to be gained, and that is the purpose of the industry ministry study. In the long run, however, it is naive to think an overhaul of major laws can be done away with. In the case of labour laws, the stumbling block is the requirement to get government permission to fire workers. In the new land acquisition law, it is the need to do R&R for most projects of a reasonable size. There are some low-hanging fruit, but there is no solution to large-scale scrapping of many laws.


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