Govt plans to give NIAB more powers
Government sources said this would drastically reduce the time taken in approving or rejecting a project. It would a major relief to Corporate India planning investments and would help the government realise the objective of boosting the investment rate and capital formation.
In a note being prepared for consideration of the Union Cabinet, the finance ministry's department of economic affairs cited the need to amend the business rules for NIAB to function effectively.
Currently, ministries and departments give various approvals under authority granted through the Transaction of Business Rules, 1961.
The key rule to be amended is Rule 4, which says: “When the subject of a case concerns more than one department, no decision be taken or order issued until all such departments have concurred or, falling such concurrence, a decision thereon has been taken by or under authority of the Cabinet.”
It is often difficult for all departments to concur on any particular project proposal. Rejection by even a single department can put the entire project in limbo.
The government plans to overcome this regulatory challenge by empowering NIAB.
The finance ministry's draft note says that these rules often lead to inordinate delays in approving projects. “While the Transaction of Business
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