Maran airs differences over IDR amendment, rushes letter to FM

new delhi: first comes the decision to liberalise industrial policy further. then comes the decision against it. in his 1999-2000 budget, union finance minister yashwant sinha announced with much fanfare the government's decision to replace the industries (development and regulation) act (idr) with a new law which would shift focus from regulation to development of industry. however, in a recent letter to the finance minister, union minister for commerce and industry murasoli maran has taken the view that there is no need to amend the idr. in his note, the minister has stated, based on our detailed examination of all relevant issues on the subject, we are of the considered view that the provisions of the act in their present form have not been found to interfere with the process of liberalisation and that the act takes care of all relevant aspects of industry, such as the provisions on licensing (in respect of a few areas where it still applies), the interest of the small-scale industry, the functions of development councils for various industries, the production reporting system. mr maran has further pointed out that in the light of the above, a further review of the idr act is not considered necessary at this stage and that the act may continue for some more time. this raises a question mark about the prospects of industrial licensing being removed in sectors like tobacco, sugar and liquor. also, some archaic definitions, including the definition of an industrial unit — employing 50 persons without the use of power, or 100 persons with the use of power — would survive in india's guiding statutes on industry. additionally, the plethora of industrial clearances which made sense under the licence-permit raj, but are irrelevant now, would remain. so also the powers of the government to forcibly take over a unit. though the new industrial policy of 1991 spelt the end of licence-permit raj, the spirit of licensing remained, because the underlying law, the idr, remained. in 1999-2000, the government decided that the idr had outlived its purpose. an expert committee was set up to recommend changes. several rounds of meetings were also held with industry. the industry associations even submitted their own version of a new industrial law to the government. the government rejected this version — it was more stringent that even the idr, aimed only at further protecting domestic industry. instead, the industry ministry actually started talking of repealing the idr. the new act, however, proposes to de-link licensing from the size of the unit and the number of employees employed by it from licensing. that meant that licensing, if retained, would apply to all units, including the ssi, which employed less than 50 employees without power and 100 with the use of power. it was at this juncture that the finance minister made the budget announcement. mr maran's letter, however, indicates that the wheel has come a full circle.

Maran airs differences over IDR amendment, rushes letter to FM

NEW DELHI: First comes the decision to liberalise industrial policy further. Then comes the decision against it. In his 1999-2000 Budget, Union finance minister Yashwant Sinha announced with much fanfare the government’s decision to replace the In...

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