New Delhi, April 26
THE Planning Commission will put up a discussion paper on improving regulatory mechanisms and setting up new regulators where they do not exist but are needed by May for national debate.
This follows a directive from the Prime Minister, Dr Manmohan Singh, to prepare such a paper. The Prime Minister is of the view that a proper regulatory regime will enable greater participation of the private sector, especially in infrastructure sectors.
The financial requirements of building the infrastructure are phenomenal and the most practical model for this purpose is public-private partnership. Addressing the Infrastructure Regulatory Conclave here, Planning Commission Deputy Chairman, Mr Montek Singh Ahluwalia, said he was personally involved in the preparation of the concept paper, which would serve as a guidepost for improving the functioning of regulatory bodies.
"I cannot give details on what we are working. However, when the paper is ready we will put it up for comments from the public, including the industry. The paper along with the comments would be handed to the Prime Minister," Mr Ahluwalia said.
There was a consensus on redefining the roles of available regulatory bodies and establishing new ones in certain other sectors.
In the presence of Mr Ahluwalia, Mr Gajendra Haldia, Adviser to the Planning Commission Deputy Chairman, made a presentation on the key issues involved in regulation.
According to the presentation, sectors need to be unbundled into competitive segments and non-competitive segments. While there should be light-handed regulation for competitive segments, full regulation is necessary for non-competitive segments. The Competitive Commission should notify the competitive segments when competition is effective. Mr Haldia said predictable regulation would improve investment climate and reduce costs.
"Predictability is the key to effective regulation," he said, adding that multiplicity of regulators should be checked and synergy among sectors should be optimised.
He suggested constituting common regulators for: electricity and gas, communications (telephony, Internet and broadcasting) and transport (roads, ports and airports).
There should be multi-sector regulators for States and suggested single appellate authority for all regulators.