Single-window clearance mechanism for foreign investors hits a bump

Manpower crunch because of Covid, only 8 states put in place the requisite infra

The Centre’s ambitious single-window clearance mechanism for foreign investors, which was expected to launch on April 15, has been delayed because states’ technical infrastructure is not yet prepared for the new mechanism. Besides, the second wave of Covid-19 and resultant lockdowns have affected manpower availability within the nodal departments.
 
As a result, it is learnt that the government has worked out a new timeline and has shifted the launch to June.
 
The new system is being developed to handhold foreign investors keen to invest in India. It aims to help them obtain all requisite regulatory and state clearances to set up manufacturing units here. The portal is also expected to have a repository of the county’s land bank, comprising information of all the vacant plots and multiple layers of connectivity, along with satellite views of the terrain.
 
“There are certain factors that have posed a challenge. First, the magnitude of the land banks is such that identifying them or respective sites for setting up manufacturing units is quite cumbersome. Second, states have to ramp-up their infrastructure to ensure that all available licences/clearance are updated on a single portal for single-window clearance,” said a senior government official in know. 
 
It is learnt that a majority of states have not created the technical infrastructure required for the system, which has resulted in Department of Promotion of Industry and Internal Trade (DPIIT) coordinating with a few states in the initial phase. The challenges faced by such states are primarily in coordinating with various sub-departments/ministries and collating the necessary information in a single easy-to-understand portal.

In addition, the DPIIT has endeavored to make the portal uniform across India, which has added to the complexity of the matter, said another source aware of the issue.
 
Sources say that so far, the Centre has managed to get eight states on board, while another seven-eight have not yet given consent for land banks. The DPIIT expected to get at least 15 states on board, including Punjab, Uttar Pradesh, Assam, Gujarat, Andhra Pradesh, and Tamil Nadu at the time of launch.
 
“The single-window clearance system intends to provide a one-shot clearance for industrial projects and do away with multiple regulatory approvals/clearances. While the DPIIT had intended to launch the project by April 15, the states that propose to be a part of such clearance will also have to keep their infrastructure ready, so that the entire process is seamless. Further, the lockdown imposed in Delhi as well as the spread of virus has adversely affected the manpower within the concerned ministry. So I think it may take some additional time to be completely ready,” said Atul Pandey, partner, Khaitan & Co.
 
Meanwhile, for domestic investors, the government is working on a national similar window — Maadhyam — which is currently in testing. The portal aims to allow investors to seek approvals required for kick-starting business in India. It is learnt that DPIIT has asked for industry feedback to be submitted by April 27. It will also integrate the existing clearance system of the Centre as well as states.
 
The portal will allow investors to track their investment proposal, resolve queries, and respond to clarifications raised by government departments on a single platform. While the timeframe for approval will not be revised, respective government departments will know where the investor’s proposal is stuck. The portal has more than 650 licences across more than 28 central government departments and 14 states.
 
“Investors will be able to apply for these central government licences/approvals by filling the Common Registration Form. Further, Maadhyam is integrated with the State Single Window (SWS) of the portal of all the participating States. The investor will be able to apply for the State licenses by filling in the relevant State Registration Form,” according to information available on the portal.