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Prime Minister Modi’s new regime for businesses looks to lighten compliance burden

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NEW DELHI: Prime Minister Narenda Modi has identified anonymous or ‘faceless’ inspections, an extended validity period for licences or automatic renewals, and lower fees among others as key elements of a new regime for business that involves lightening the compliance burden.

The Department for Promotion for Industry and Internal Trade (DPIIT) is working on the agenda with the NITI Aayog after the Prime Minister said the framework needs to be drawn up urgently.

The DPIIT has written to states and various ministries and departments to identify processes and permissions, especially ones that require periodic compliances and renewals. The exercise will also cover departments and agencies that provide various services to citizens.

The PM has said permissions and licences should not require frequent renewals as this imposes a cost on businesses, especially small and medium enterprises, according to a person with knowledge of the matter.

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“The idea is very clear… Compliance burden needs to come down,” a senior government official said.

Sectors such as hotels, restaurants, leather and cement have broad compliance requirements and need frequent renewal of various permissions and licences. These add to the cost of doing business and erode competitiveness.

The exercise is aimed at identifying regulations that impose such onerous compliances and what can be done to simplify them.

The Prime Minister’s directive is that even if renewals are needed, the validity period should be increased and the process move to online from offline, the official told ET. Work has begun to assess whether inspections can be done anonymously. The government recently rolled out faceless assessment for income tax and has also launched a pilot for customs.

“All departments that directly give services to citizens have been asked to identify the compliances required, remove the redundant ones and simplify the necessary requirements,” said another official.

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