The proposed National Investment Approval Board (NIAB) will help speed up environmental,forest and other statutory clearances for nationally important large projects and likely pull the economy out of the trough,Planning Commission deputy chairman Montek Singh Ahluwalia said on Wednesday. The NIAB will have the mandate to take a holistic view of projects that come up before it,even while being sensitive to the technical inputs from the ministries concerned and allowing the bureaucracy to feel protected and express its views fearlessly,he said.
Speaking at the Indian Express Groups Idea Exchange programme,he made a strong pitch for measures that could take the gross fixed investment to 34 per cent of GDP by the end of the current Plan,a process that will take GDP growth back to the 9 per cent level.
Laying down the short- and medium-term plans for this,he said the government would do well to take further policy action and administrative measures that would inspire confidence among investors over the next six months. He listed the goods and services tax on which he said a lot of progress has been made the proposed rollout of the unique identification number and suitable public-private partnership models being evolved for infrastructure investments among the key structural reforms needed for the economy to enhance its productive capacity. He also highlighted the plan to give more flexibility to states in using Plan funds as a key reform initiative. As for social and physical infrastructure projects funded under centrally sponsored schemes,he said states ought to be given flexibility in using 10 per cent of the funds on each head for innovative purposes. The Centre must not do micromanagement, he said.
Terming the current file-based procedure (wherein layers of officialdom gives their views in a sequential manner) damaging,he said it was absolutely impossible to fix responsibility in this system which dates back to the 19th century.
The NIAB regime would bring greater accountability to the decision-making process,he said. Once the Cabinet secretariat gives the statutory clearances for projects after the NIAB vetting,those decisions would be hard to contest. The NIAB would have a role even bigger than the empowered group of ministers,he said. Ahluwalia also said the Centres fiscal deficit must be lowered to 3 per cent of GDP by 2016-17 for inflation to recede to a reasonable level of 5-6 per cent and ensure an average annual economic growth of 8.2 per cent during the current Plan period.