Centre to open up more sectors to liberal world

NEW DELHI: Liberation is on the cards for industrial sectors that are still living under the shadow of licence raj. A beginning in this respect has been made with a proposal to remove residual restrictions and controls in sugar, petroleum refining, fertiliser and drug sectors.

The initiative is part of reforms agenda of the UPA government that includes stepping up investment in manufacturing by removing procedural bottlenecks that have continued from the erstwhile licence-permit raj.

According to sources, the Centre would soon ask administrative ministries to identify areas that remained untouched by reforms and take decisions to remove the controls hampering growth. Some of the decisions could be taken under the existing policy framework and may just require approval of the administrative ministries.

The suggestions for removing residual restrictions and controls has also been given by the Planning Commission. In the final draft of the Eleventh Plan, the Commission has said that controls in sectors such as sugar, petroleum refining, fertiliser and drugs should be progressively eliminated to boost investments and make the sectors more competitive.

The draft approach to Eleventh Plan has set a 10% annual growth target for industrial sector and 12% for manufacturing sector. Together with services and agriculture sectors, this would hold the key to attaining an average GDP growth rate of 9% during the plan period.

The final draft has also favoured amendments to the Companies Act, 1956, to facilitate rehabilitation and liquidation procedures for industrial units. This is also considered a move that could increase investments. Absence of any effective regulation on rehabilitation and liquidation often makes companies apprehensive about bringing investments.