Government puts off decision on fast-track project clearance body

The union cabinet has deferred a decision on setting up a National Investment Board (NIB) to fast-track clearance of projects worth over Rs1,000 crore till at least next week, as Prime Minister Manmohan Singh reportedly wants more inter-ministerial discussions on the proposal after several ministries opposed it.

The proposal for an overarching body empowered to overrule ministries on project approvals is the brainchild of finance minister P Chidambaram, who first floated the idea around June this year. It apparently found considerable favour with the prime minister and other senior policy-makers.

The finance minister has now reportedly circulated a note on the proposed NIB, or a Cabinet Committee on Investments, with power to set timelines for ministries to clear high-value projects. The note was due to be taken up by the cabinet today but has been postponed till the next meeting.

Among the strongest opponents of the proposal are environment and forests minister Jayanthi Natarajan. Defence minister A K Antony and the ministry of mines under Shriprakash Jaiswal have also opposed the move.

The defence ministry's objection is that timelines are not feasible where matters of national security are involved. The ministry of mines feels an NIB will lead to legal complications. The environment ministry thinks that the purpose of its existence will be defeated if its objections to clearances based on environmental health and tribal welfare can be overruled.

Environment minister Natarajan has been the most vociferous opponent of the proposal. In a letter dashed off to Prime Minister Singh in early October, she called the NIB proposal "unconstitutional" and "completely unacceptable".