Green Minister NIBs it in the bud

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Turf battle Chidambaram wanted to circumvent Jayanthi Natarajan’s ministry but the latter had the last laugh
Turf battle Chidambaram wanted to circumvent Jayanthi Natarajan’s ministry but the latter had the last laugh Photo: Shailendra Pandey, AFP

IT WAS named the National Investment Board (NIB), Finance Minister P Chidambaram’s audacious and, some would say, over-the-top move to set up a one-stop clearing agency for big economic projects. His target was the environment ministry, which he saw as delaying things. It has now been renamed the Cabinet Committee on Infrastructure and, following a determined battle by Environment Minister Jayanthi Natarajan, is only a shadow of the overriding authority he had initially proposed.

The original note for the NIB, drafted on 1 October, seemed to suggest a supra- Cabinet body. “The NIB would prescribe different time limits,” the note said, “in consultation with the ministries concerned, for taking decisions on different types of approvals and clearances for each sector under that ministry/department… In case the decision is not taken within the stipulated time period, the authority of the concerned ministry/department would stand transferred to the NIB for taking the decision.”

The NIB could also review applications that had been “delayed/rejected” by a ministry. While this was deemed important to “reduce litigation”, it in effect made the NIB an appellate authority, sitting in judgement on individual ministries. The NIB secretariat would be “located either in the PMO or in the Department of Economic Affairs”.

Sensing the move would permanently change the balance — institutional and individual — in the Cabinet and essentially render several ministries toothless, the green ministry led the charge. In its response, it called the NIB idea “ill-conceived”. Consequently, on 13 December, the Cabinet approved a much diluted version.

The NIB nomenclature was dropped. The new name is the Cabinet Committee on Investment (CCI). It will monitor projects of Rs 1,000 crore and higher and replace the Cabinet Committee on Infrastructure — meant to monitor projects of Rs 300 crore and higher, and now dissolved. From an appellate authority, it has become purely a monitoring body that will ensure ministries and “statutory authorities” abide by their own timelines for “taking decisions to promote investment and economic growth”. The NIB can no longer override or decide for individual ministries.

While Natarajan saw this as vindication and told the media “all our concerns have been met”, Chidambaram is clearly not happy. In the revised note placed before the Cabinet on 13 December, the finance ministry urged the NIB nomenclature not be dropped entirely and be used as a dual name along with CCI: “In the current situation of gloom, when growth rates are going down, there is general cynicism among investors, and constitution of another Cabinet sub-committee may not enthuse the market in the same manner as NIB would. In other words, NIB, which has already been in the news for a while and has wide-ranging acceptance amongst the investors, is like a brand name that can enthuse investors.”

The appeal didn’t carry the day. One minister, opposed to Chidambaram, apparently said, “The market must be pretty naïve to be swung by such words.” More substantively, the CCI was put squarely under the PM’s chairmanship.

Residual niggles remained. The finance ministry’s proposal said the CCI, in its attempt to “de-bottleneck key impediments by fast-tracking the required approval/clearances… may invite relevant participation from the states”. It was clarified at the Cabinet meeting that “de-bottleneck” attempts would be restricted to monitoring timelines and not taking decisions in the domain of technical agencies under individual ministries. Some of these technical agencies have a judicial mandate. Further, consultation with the states — on land acquisition and so on — would be done by the individual ministry and not the CCI.

Ironically, the finance ministry turned to the CAG’s report on coal block allocation — otherwise criticised by the government — to build its case for an NIB/CCI: “The report of the CAG on allocation of coal blocks and augmentation of coal production for the year ended March 2012 recommends… ‘There is a need to constitute an empowered group along the lines of the Foreign Investment Promotion Board as a single-window mechanism… to grant the necessary clearances such as mining lease, mining plan, forest clearance, environment management plan and land acquisition for accelerating the procedures for commencement of production’.”

The argument didn’t convince Natarajan. Will Chidambaram strike back in some other form?

Ashok Malik is Contributing Editor, Tehelka.
[email protected]

1 COMMENT

  1. With impunity, Starched Collars is leading the way towards total annihilation of what was once sacrosanct- Desabhiman, Desprem and Desbakth. There is no Karma.

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