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LATEST NEWS UPDATES | In Odisha's Single Window Clearance System, a Compromise for the Ease of Doing Business -Arpitha Kodiveri

In Odisha's Single Window Clearance System, a Compromise for the Ease of Doing Business -Arpitha Kodiveri

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published Published on Dec 9, 2017   modified Modified on Dec 9, 2017
-TheWire.in

While synergising state and business interests through ‘single window’ mechanisms helps investors, it can compromise the role of regulatory agencies like the state pollution control board.

On November 16 ,2017 Odisha chief minister Naveen Patnaik launched an online system called GO-SWIFT for supporting the state’s existing ‘single-window clearance system’.

Odisha continues to be ranked high among different states in India on the ease of doing business index. It is part of a group of many other states like Rajasthan, Andhra Pradesh, Telangana, Punjab and Kerala which have adopted the single window clearance system – a procedure that is aimed at making things easier on investors by cutting through red tape and even potentially reducing corruption.

Though seen as an innovative step, a closer look at the legal basis for the system reveals many impending issues that are yet to be addressed.

The law that has enabled the single window clearance is the Odisha Industries (Facilitation) Act, 2004 (OIFA) and Rules, as amended on 2015. It establishes a three-tier system for granting clearances through the district, state and high level clearance authorities. It is known to provide 32 clearances from 15 state departments. These authorities are supported by the Odisha Industrial Infrastructure Development Corporation (IDCO) whose mandate is to provide land and infrastructure for industry and the Industrial Promotion and Investment Corporation of Odisha Ltd (IPICOL) which is required to promote industries within Odisha.

While this institutional architecture seems geared to streamline the process of obtaining multiple clearances within the state, it showcases the design of state institutional structures which primarily support business interests.

The process of granting speedy approvals with rigid timelines comes with a compromise on the degree of scrutiny that these approvals are subject to. This is seen particularly on air and water pollution criteria and labour law standards. With limited avenues available to challenge the clearance granted by the authorities, local communities affected by these projects find it harder to have their voices heard and influence decision making on aspects of land acquisition, pollution and labour rights. The existence of deemed approvals and self-certification processes aim to deregulate in an effort to simplify. They reduce the regulatory oversight on part of the different state departments. This is seen particularly with the voluntary compliance scheme in place for 18 labour laws with reduced frequency of inspections to once in three years.

The parallel system

The three-tier system of clearance authorities is an overarching body whose decision in relation to the different approvals are considered final. While this assures that industrial units have to engage with a single authority, the different state departments granting approvals are now pressured to conform to the decisions taken by the clearance authorities particularly due to deemed approvals.

The OIFA puts forth rigid timelines for the granting of the different clearances which include clearances by the state pollution control board which are known to be overburdened. In the event that the concerned department does not provide the required clearance within the stipulated time the clearance authorities have the power to grant deemed approvals. This can be problematic, for instance, if a Company ‘X’ is yet to obtain ‘consent to establish’ from the pollution control board. The discharge of effluents can continue on the basis of a deemed approval while a final clearance may not be granted or granted with stipulated conditions.

The single window clearance requires that potential industrial establishments submit a combined application form. Part C of the combined application form relates to the consent to establish and consent to operate approval to be granted by the state pollution control board. This part of the form does not require complete disclosure on aspects related to on the existing quality of air and water in the area surrounding the industry which is normally required by other states.

Further it requires identification of human habitation only to the extent of 500 meters around the establishment. The impact of the pollution from the industry may go further that the designated 500 meters which is not taken into account while granting the consent to operate or establish. Schedule III of the CAF consists of a self-certification process where the industry certifies that it will comply with the provisions of applicable Acts and rules or orders or instructions as per Section 10 of OIFA. While this enables the industry to take onus on complying with the rules and regulations it may result in minimal inspections by the regulatory authorities since industries are assumed to act responsibly. This was a system proposed by the T.S.R. Subramanian committee in their report for simplifying the environmental clearance process but was heavily criticised by environmentalists given the bad track record of industries and their non-compliance with environmental laws.

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TheWire.in, 8 December, 2017, https://thewire.in/202823/odishas-single-window-clearance-system-compromise-ease-business/


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