ADOPTION OF REGULATORY IMPACT ASSESSMENT IN INDIA POLITICAL

ADOPTION OF REGULATORY IMPACT ASSESSMENT IN INDIA: POLITICAL ECONOMY CHALLENGES – HOW TO OVERCOME Removing Roadblocks to Adoption of RIA in India: A Proposal Siddhartha Mitra Jadavpur University

Outline • RIA: Working Definition and Roadblocks • Working around the Roadblocks – Generating the forces of demand supply • Demand Generation » Central message to be delivered » How to spread the message • Building capacity to do the RIAs • Removing the Roadblocks – Overcoming opposition from bureaucrats and politicians – Promoting regulatory independence 2

Working Definition and Roadblocks • Definition: Concrete cost benefit analysis of regulatory alternatives to facilitate choice among these • Roadblocks: Possible opposition from politicians and bureaucrats – Politicians: promote special interests, populist regulation or focus on issue of the day – Bureaucrats: promote overregulation 3

Working Around Roadblocks • Deliver message to community, especially business and media – Content of the message should focus on » The fact that RIA maximizes net benefits » Costs are kept within reasonable bounds – How should the message be delivered » From CUTS International to NGOs, media, chambers of commerce and business houses » These in turn can feed the message to the grassroots • Build capacity of staff in regulatory bodies to do RIA 4

Overcoming roadblocks • Win over politicians and bureaucrats – RIA provides certified documentation – By maximising benefits RIA might have a salutary impact on fortunes – Provides a fair and clean image • Keep alive the movement for regulatory independence – Regulatory independence involves separation of the state as owner of public utilities and regulator – Autonomy in rule making, rule application and litigation – Chicken and egg relationship between RIA and regulatory independence » Promotes regulatory independence » Independence in means necessary for undertaking RIA 5

Overcoming Roadblocks (2) • Regulatory independence: a means of effective RIA • Absence might mean that only subset of costs/benefits of regulation are focused on • Costs and benefits are not quantified 6

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