Questionable force

A task force to push stalled projects sidesteps the real hurdles,and raises questions on CCI’s efficacy

Written by The Indian Express | Published: June 4, 2013 2:27 am

A task force to push stalled projects sidesteps the real hurdles,and raises questions on CCI’s efficacy

The prime minister has announced a new task force to track stalled projects in the power,coal,mines and road sectors. The government has not yet provided a report on the functioning of the Cabinet Committee on Investment (CCI),which is said to be performing the same task. What is the need for setting up another body? Has the CCI failed in its job? If so,why? What is the difference in the remit of the task force and the CCI? By now,the government should have provided an analysis pointing out the laws,regulations and institutional frameworks that have stalled projects. It should have initiated changes in those laws.

This newspaper has argued earlier that quick fixes such as boards,committees or task forces cannot address the stalemate that characterises investment in India today. On the one hand,there is an institutional and legal framework that does not support transparency in decision-making in multiple areas of government interaction with the public,and on the other,there is a bureaucracy that is frozen on account of being held responsible for discretionary decisions. To give clearances for projects would mean that somebody has to take the responsibility for a decision that benefits one or another party. In a system where the prime minister is not seen to be taking the responsibility for such decisions,or backing those who have taken discretionary decisions,the optimal policy for risk-averse bureaucrats is to take no decisions.

The first attempt to clear large stalled projects was to be undertaken by the National Investment Board which,it was reported,was to be housed in the ministry of finance. This was objected to by the environment minister,who did not agree that environment clearances for mega projects should be given quickly or easily. Then came the CCI. In principle,the committee could have taken any decision since ministries are only bodies to which the government or cabinet has delegated the responsibility of carrying out certain tasks. The fact that now a task force is being set up to carry out a similar job suggests that it faced roadblocks.

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