Under fire from all sides over policy inaction that has seemingly led to the slowest GDP growth in nearly a decade,Prime Minister Manmohan Singh on Friday set up an Investment Tracking System to ensure that projects do not hit snags.
Major projects will be specially tracked to take them forward on a fast track in order to provide a fresh impetus to the economy. This was in the context of delays faced by projects on multiple fronts security clearances,environmental clearances,other clearances,land related matters, said an official statement from the Prime Ministers Office. The issue was originally raised at a meeting of the PMs Council on Trade and Industry in December,prompting the Prime Minister to promise that a system to track major projects would be created.
But the move to assuage concerns of investors who are getting increasingly worried about the countrys uncertain tax and regulatory environment came a day after official figures revealed that the Indian economy grew at a mere 6.5 per cent in 2011-12,with the last quarter growth touching a nine year low of 5.3 per cent.
The Investment Tracking System would monitor all projects costing over Rs 1,000 crore. While all public sector projects of over Rs 1,000 crore would be tracked by the National Manufacturing Competitiveness Council (NMCC),the department of financial services (DFS) in the finance ministry would monitor private sector projects with investments in excess of Rs 1,000 crore.
The NMCC and the DFS would be expected to submit quarterly reports on the progress of projects or any issues flagged by the Prime Minister. As part of the reports,they would identify all issues that need to be resolved to speed up projects.
Corrective action will be taken wherever found necessary, the PMO has promised while admitting that a lot of the delay is avoidable if only there is a will to resolve matters. Many big ticket investments including Poscos $ 12 billion steel plant in Orissa have been facing delays due to issues of land acquisition and environment clearances. The investment rate during 2011-12 declined to 29.5 per cent,from over 30 per cent a year ago.
PMs trade council met only twice in 2 years
Even as the government is trying news ways to woo investors,a high powered committee on trade and industry that is chaired by Prime Minister Manmohan has met just twice in over two years.
The PMs Council on Trade and Industry,which consists of the whos who of India Inc including Tata Sons chairman Ratan Tata and Reliance Industries Ltd chairman Mukesh Ambani,was re-constituted on April 22,2010,as a forum for policy dialogue on important economic and other issues relevant to trade and industry between the government and trade and industry. But since then,it has held only two meetings on May 26,2010,and December 22,2011. While the first meeting was largely a preliminary meeting where five sub-committees were set up on issues such as skill development and financial inclusion,the second meeting focussed on the global crisis and inflation.