New Delhi, Jan 4 (UNI) State governments should come out with a decision to deregulate the small scale industries (SSI) as manufacturing and employment growth would fall extensively if it remains under the grip of 'inspector raj', an industry body said.
The SSI sector continues to remain under the tight grip of inspector raj with their numbers going up by 15 in the last 16 years, revealed industry chamber Assocham.
''Liberalisation did not happen in the SSI sector because state governments never took special initiatives for reducing the number of inspector,'' the chamber's assesment of over '17 years of Liberalisation Vs Inspector Raj' pointed out.
The SSI sector which would go through inspections from excise, customs, banks, insurance, PF, PPF and record inspectors, 16 years ago is now subjected to many other inspections which include one separate inspector to monitor their register of employees, accounts, balance sheet and on taxation fronts particularly the service tax inspector.
Likewise, many more areas were added in which the sector is subjected to tedious inspections.
Besides, the Factory Act 1948, Minimum Wages Act 1948, Payment of Bonus Act 1965, Employment Exchange Compulsory Notification of Vacancies Act 1959, Air (Prevention&Control of Pollution) Act 1981 jointly provide empowerment to government departments and various state governments to still regulate the SSI sector, the report said.
However, 17 years of liberalisation has reduced 'inspector raj' by over 50 per cent in food processing industry, ever since it took in July 1991.
''Minister of Food Processing Subodh Kant Sahay should be credited for enacting the Unified Food Law, a composition of nine laws, which is primarily responsible for hugely reducing the number of inspectors for food processing industry,'' Assocham president Venugopal N Dhoot said.
Before enactment of the law, the industry would be subjected to multiple inspectors such as Weighing Inspector and Inspectors for ISI, Corporation, Health, Hygiene and even Medical etc. Today, these sectors are examined by not more than two inspectors, Mr Dhoot added.
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