The Union cabinet on Thursday deferred the proposal of setting up a National Investment Board (NIB) or a Cabinet Committee on Investments (CCI), as an overarching body to approve and monitor projects worth Rs1,000 crore, due to lack of consensus.
“It was felt that further discussions were required before deciding to set up this crucial body,” a cabinet source told DNA. He hoped the issues between the ministries would be sorted out by next meeting.
After apprehensions form various ministers that NIB would become a super cabinet, usurping their authority, prime minister Manmohan Singh had reportedly agreed to rejig cabinet committees.
According to the new proposal, it was decided to constitute a new Cabinet Committee on Investments (CCI), representing key ministers with an authority earlier proposed for the NIB to expedite projects. Also it was proposed to merge the existing Cabinet Committee on Infrastructure with Cabinet Committee on Economic Affairs (CCEA).
A cabinet source said the prime minister was concerned at the tardy progress of mega projects and wanted an overarching inter-ministerial body to monitor their progress regularly. “Lots of public funds stand locked in these projects. There is need for a via-media to find a way out to expeditious completion as well as based on this experience to provide a single window from the stages of clearance to their execution for the future projects worth more than Rs. 1,000 crore,” the source added.
While the defence ministry had objected to the time lines, the ministry of mines in its note held that it will lead to legal complications, The environment ministry has reiterated that such a plan is ill-conceived and not likely to meet achieved objectives.
These ministries also fear that the Board would be filled up with bureaucrats and technocrats, who would be breathing on the neck of ministers, undermining their authority and position. Therefore, they had suggested that instead of creation of a Board, it was prudent to constitute an cabinet committee, with members from ministries concerned .
However, the finance minister P Chidambaram has made a strong case for the National Investment Board, saying it would have acceptance among investors. The note also suggests that the PM should be the chairman of the board and should nominate other members.
The cabinet note said there were over 100 projects, each involving investment of Rs1,000 crore or more, that have been delayed for various reasons.
The finance ministry felt the setting up of a Board will give a fillip to India’s economic growth.
“Our problem is not conceptualising projects. Our problem lies in getting numerous clearances and getting the project off the ground within a reasonable time,” says Chidambaram’s note.
He also said similar arrangements were in place in Japan, Indonesia, Malaysia and Thailand.