Small Scale Industry
Investment in Industry
Develop North East
Estimates for 1998
Assistance to States
Non Plan Expenditure
|Private Investment in Industry
20. The government accords high priority to
boosting private investment, including foreign investment, in industry. We must minimise
bureaucratic and procedural hurdles and create an investor friendly environment.
Industrial licensing was abolished in most industrial sectors as part of the economic
reforms. On reviewing the remaining handful of licensed sectors, the government have
further decided to delicense coal and lignite and petroleum products.
21. Industrial deregulation would remain incomplete without reducing the burdens imposed
by the "Inspector Raj". The majority of inspectors operate under State level
statutes. Government have initiated a dialogue with the State Governments to explore the
consolidation of regulatory legislation relating to industry and exchange of best
practices across States in carrying out the necessary inspections in the least burdensome
way. I will return to this subject when I present my excise proposals.
22. The Foreign Investment Promotion Board (FIPB) has done a good job in promoting foreign
investment and streamlining the procedures at the Central government level. Foreign
investment flows have increased substantially and were estimated to be $3.1 billion in
1997-98. About 60 per cent of investment approvals are in the energy and infrastructure
sectors. It will be our objective to create conditions in which foreign investors will
find India an attractive investment destination. We hope to double the inflow of foreign
direct investment within two years.
Foreign investors are frequently inhibited by lack of familiarity with our systems and
statutes and particular problems at the State level. To reduce such problems, we will
implement a system whereby, an officer of the administrative Ministry would be designated
as a monitoring officer to help processing and implementation of the project in
conjunction with Central and State authorities for every foreign investment proposal
exceeding Rs.100 crore. We are committed to creating a hassle-free procedure and I would
like to assure all foreign investors that a decision on their investment proposals shall
be taken within a period of 90 days. It will be the personal responsibility of the
monitoring officer to ensure this.