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New Delhi, 6 August Among its initiatives to make doing business in the country easier, the labour ministry will on September 1 launch a scheme to liberalise the way inspection for compliance with labourrelated laws is done. In what could be a move to crack down on the so- called inspector raj, the new inspection scheme will take away inspectors' discretionary powers. The next such initiative will be a unified portal, to be launched on October 2, that will serve as the common platform for employers to file their annual returns and compliance &inspection reports. "These steps will bring a paradigm shift in the way the country is viewed and help boost India's ranking in ease of doing business," said a senior labour ministry official asking not to be named. The new inspection system will initially cover 16 of the 44 Acts administered by the Union labour ministry, including the Industrial Disputes Act, 1947. It will have three kinds of inspections — the areas where inspection is mandatory, those where it is optional and the instances where it is based on compliance. All inspections for the Employees Provident Fund Organisation ( EPFO) and the Employees State Insurance Corporation ( ESIC), besides those in the ambit of the Chief Labour Commissioner and the Directorate General of Mines Safety ( DGMS) will be covered under the new scheme. Under this system, mandatory inspections will be done only in extreme cases. For instance, if a fatal or serious accident has taken place, or in the cases of continuous strikes or lockouts. Optional inspections will be automatically generated through a system on the basis of the priorities of the organisation concerned. For the inspections based on compliance, a Central Analysis and Intelligence Unit (CAIU) will be set up to analyse and collect field data; the cases will be referred to this unit for evidence- based approval for inspection. An inspector will then have to file his or her report within three days of going to the field. "The inspectors sometimes use their powers to harass both employees and employers. The new system will make them more accountable and take away their discretionary powers. The inspectors cannot go to inspect of their own accord. And their reports will not be considered valid if those are not uploaded within three days of inspection; action will be taken against them in the event of delay," said the official. The unified web portal will make the compliance process easier for industry and initially cover 16 central laws. Through this portal, the companies could file their annual returns and inspection reports and the format for these would be simpler from those in force at present. This integrated portal will operate through a unique labour identification number for each employer or establishment. The employers will be allotted labour identification number ( LIN) after registration on the web portal. "This will provide easier returns for designated Acts, simpler format for annual returns and a window for inspection reports," the ministry official said. The annual return has been reduced from an 80- page long format to a five- page document. Similarly, the inspection reports have also been reduced considerably. "These steps will curb manual interference and encourage the use of technology, so that industry can engage in a better manner with the labour department," the official added. EPFO, DGMS and ESIC have begun the initial work to put the new systems in place by August 31. REMOVING HURDLES New inspection scheme What is the aim? To curb inspector raj, take away inspectors' discretionary powers How does it work? Mandatory: Extreme cases Optional: System- generated Compliance- based: Only after approval of a separate unit Unified web portal What is the aim? To ease compliance with labour- related laws What is it and what does it cover? A common window for online registration of units, reporting of inspections, submission of annual returns and redressal of grievances; covers 16 of the 44 central Acts |
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| NDA eases green rules to push investments |
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New Delhi, 6 August Through a quick series of notifications, the Union environment ministry has eased rules for mining, roads, power and irrigation projects and other industrial sectors. It has diluted a host of regulations related to environment, forest and tribal rights. Besides, sources in the ministry say, more changes in regulations are in the pipeline. Environment Minister Prakash Javadekar had earlier done away with the requirement of public hearing for coal mines below 16 million tonnes per annum ( mtpa) wishing to expand output by up to 50 per cent. This has now been extended to mines above 16 mtpa, permitting them to mine up to five mtpa more without consulting affected people. Public hearings, the only occasion when affected people are consulted for clearances, have in the past turned violent at times, or seen protests leading to litigation. Union Power & Coal Minister Piyush Goyal had approached the environment ministry in May requesting similar rules for expansion of coal output in big and small mines. The environment ministry had on May 30 exempted public hearing if the increased mine output was up to four mtpa. The Centre, on the request of the coal ministry, had in June also decided to consider group clearances for Coal India Ltd mines that were in close proximity, rather than individual project proposals. The need for consent from gram sabhas for prospecting in forests has also been done away with. This dilutes the Forest Rights Act, which requires the consent of tribals before forest land is diverted to industrial activity. Alongside, inspection of mining projects by ministry officials for plots less than 100 hectares has been removed. The ministry has also set aside the requirement of compensatory afforestation for prospectors. Turn to Page 17 > Rules for mining, roads, power and irrigation projects relaxed EASIER NORMS COAL PRODUCTION |Coal companies' expansion up to a fixed limit without mandatory public hearing |Clearance in clusters for nearby mines, instead of separate approvials MINE PROSPECTING |Prospecting in forest areas exempt from tribal rights settlements and consent |No govt inspection for prospecting up to 100 hectares |Compensatory afforestation done away with |Tribal gram sabhas' powers for securing rights over forest land diluted; settlement and consent for projects to be managed by district administration TRIBAL RIGHTS |National Board for Wildlife (NBW), without independent forest and wildlife experts, to clear projects *Plan to dilute National Green Tribunal's powers REGULATORY EASING INDUSTRIAL BELTS |Ban on new industries in critically polluted industrial areas lifted; pollution index- based moratoriums stopped INDUSTRIES | Irrigation projects get easier route, separate from power components |Thermal, coal, paper pulp, mining and other polluting industries can, to a larger extent, get clearance from states *Norms for protective ring against polluting industries around wildlife areas diluted |
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| Click: Article continued from…NDA eases green rules |
| NDA eases... |
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Besides these, the government has also amended the environment impact assessment notification of 2006, letting several industries up to acertain size go to state governments for clearance, instead of approaching the Centre. Industry has usually found it easier to get clearance from state governments. The National Democratic Alliance (NDA) has also permitted mid- sized polluting industries to operate within five km of national parks and sanctuaries with state clearances, compared with the 10- km limit imposed by the Supreme Court. This has been done by changing the pollution- related classification of industries. Also, the amended environment impact assessment notification allows coal tar processing units to get clearances from state governments. Mineral beneficiation projects up to 0.5 mtpa will also be cleared by state governments. Earlier, only those up to 0.1 mtpa capacity were allowed to approach the states. Irrigation projects below 2,000 hectares need not apply for clearances anymore and those between 2,000 and 10,000 hectares can be cleared by state governments. By also separating power from irrigation projects, developers can now take projects piecemeal to different agencies for clearance. Business Standard had previously reported that the NDA government had suspended a pollution indexbased moratorium on new industries in critically polluted areas like Singrauli and Vapi. Instead, it has asked its experts to revise the index. The government has also taken the teeth out of the National Board of Wildlife. The board's standing committee, now without independent wildlife and ecology experts, is slated to clear several dozen projects at its meeting on August 12. A host of other changes in norms for environment and forest clearance are also being discussed within the environment ministry and the Prime Minister's Office, alongside a review of the powers of the National Green Tribunal. >FROM PAGE 1 |
| Cabinet liberalises foreign investment regime for defence, railway projects |
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New Delhi, 6 August The Union Cabinet on Wednesday cleared the proposal to set the composite cap for foreign investment in the defence sector at 49 per cent, compared with the current 26 per cent foreign direct investment (FDI) ceiling. But the management control of companies receiving these investments must remain in the hands of Indians. Also, some railway operations and projects were allowed to receive up to 100 per cent FDI. The decisions came barely two weeks after the Cabinet approved a similar proposal to set the composite foreign investment cap for private insurance firms at 49 per cent, provided 'control' remained with Indians. According to officials in the know of the developments, all proposals for FDI in the defence sector, even those for less than 26 per cent, will require approval from the Foreign Investment Promotion Board ( FIPB); these clearances will be given on a case- to- case basis. This is believed to have been done keeping in mind " national security concerns, as it ( defence) is a highly sensitive sector". By comparison, the decision for the insurance industry was that FIPB's clearance would be required in proposals for more than 26 per cent FDI. Also unlike the insurance decision, the approval for defence FDI is an executive decision and will not require Parliament's clearance. The government has not been able to table the insurance amendment Bill in the Rajya Sabha due to persistent demand from Opposition parties that the legislation be referred to a select committee. The government is believed to be optimistic that Wednesday's decision will attract foreign companies interested in setting up manufacturing facilities here. But experts do not appear impressed. Turn to Page 17 > OPENING UP Defence Earlier position: |Up to 26% FDI allowed through the Foreign Investment Promotion Board ( FIPB) route |Clearance from the Cabinet Committee on Security required for FDI beyond 26%; approval on a case- tocase basis New position: |Up to 49% FDI allowed after FIPB approval |Control has to be with Indian companies Railway projects Earlier position: |FDI prohibited New position: |Up to 100% FDI permitted in in some operations like freight corridor, high- speed train, port and mining connectivity projects through different modes |Up to 100% FDI allowed in most cases in rail projects like gauge conversion, construction of new lines, doubling of new lines and maintenance PPP projects Related reports on Page 4 |
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