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Multiple Regulatory Bodies in India – Issues & Suggestions

Multiple regulatory authorities

Regulatory body is an organization set up by the Government to monitor, guide and control a particular sector such as banking, insurance, education or healthcare.

The number of regulatory bodies in India has increased greatly after the economic liberalization of 1991 when the government gradually transformed itself from player to umpire. Today, we’ve independent regulators for most of the areas of business, economy, higher education or healthcare.

Issues with multiple Regulatory authorities in India:

1) The issue of multiple regulatory bodies with overlapping jurisdiction is major cause of governance deficit in India.

2) Lack of clarity leads to politicization of institutions.

3) Duplication of funds, functions and functionaries along with Lack of accountability goes against the maxim of “minimum government and maximum governance”.

4) While regulators enjoy functional independence, they still fall within the broad domain of the executive branch of the state, which makes them susceptible to the pressure groups and corporate lobbying.

5) Recommendations made by Regulatory Authorities are rarely implemented.

6) Regulatory hurdles choking growth of economy.

Suggestions with example:

-> Parliament by law should clearly define the functions, responsibilities, powers, privileges of Regulatory Authorities to increase the efficiency of regulatory authorities.

-> Following the practices in developed countries, to address the issues of nuclear safety and environmental protection in an impartial manner, an independent statutory body is necessary, instead of the present board which falls under the Department of Atomic Energy.

-> The regulatory bodies should be kept out of ambit of any political influence.

-> However, statutory status and independence alone is not the panacea. Food Safety and Standards Authority of India (FSSAI)’s ban on Maggie noodles and subsequent developments highlight the need for manpower, capacity building and infrastructure upgrade to help such regulators in achieving their objectives.

-> The issue of UGC granting “deemed university” status to poorly managed colleges highlights that political will is also necessary to enable the regulators to achieve their objectives. Government, also, planning to scrap University Grants Commission (UGC) and All India Council for Technical Education (AICTE) and setup a new body called Higher Education Empowerment Regulation Agency (HEERA), but let’s not digress.

-> Forward Market Commission failed to prevent the National Spot Exchange Limited (NSEL) scam and Medical Council of India president was arrested for corruption in granting permission to medical colleges. Hence, much depends on the character and caliber of the personnel serving in an institute, than the statutory powers & autonomy of the institute itself.

-> Reliance KG Basin controversy also highlights the need of an independent statutory regulator in the upstream oil and gas sector instead of the present executive DG hydrocarbon, to balance investors’ confidence vs nation’s right over its natural resources.

-> Government should consider recommendations of Punchi commission and Srikrishna panel regarding an independent regulator overseeing all regulators.


Some regulators have achieved useful outcomes. However, the creation of independent sectoral regulators in India has not been accompanied by critical reflection on their role, or attention to the political, legal, and institutional contexts within which they operate.

The existing mechanisms of legislative oversight over regulators’ performance need to be strengthened considerably to be more effective. The centrality of legislative oversight comes from the design of regulators—the functions of the executive, legislature and judiciary are combined in the role of the regulator.

Public Administration by G.Rajput

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