Cautioning against the state interference in the functioning of regulators for vested interests, Competition Commission chairman Ashok Chawla on Monday said that for an independent regulator to deliver, the “state actors have to forbear”.
“Continued interference by the state compromises the efficiency enhancement role of the regulator. Intervention to promote public policy or redistribution objectives, to some extent, is understandable. However, interference to protect vested interests is undesirable,” he said at an Assocham event here.
He added that there is a need for effective regulatory incentives and governance regimes as regulations in the country suffer from a “legacy of weak institutions”. Making a case for an over-arching legislation to ensure uniformity in economic regulations, the CCI chief also said that regulators seem to have become the ‘mantra’.
“Some of the new regulators with new found zeal tend to become policemen… may be we are over-doing in terms of regulation … Perhaps there is a need for a helicopter view of the regulatory structure,” he said.
The chairman also added that for creation of an independent regulatory institution, direct regulation by the government is “not appropriate as it amounts to the fox guarding the chicken coop.”