Karnataka Industries Minister M B Patil.
Credit: DH Photo
Bengaluru: Karnataka has picked computing giant Microsoft to design a new single-window system for a “simple and clear” regime to approve investment proposals, replacing the current one that is often frowned upon as lacking ease of doing business.
The new software system will be linked to reforms that Industries Minister M B Patil is planning, which includes the creation of a new investment promotion agency that is likely to be helmed by an industry veteran.
In fact, Microsoft has been given the task of building a “state-of-the-art” single-window system at a cost of Rs 11.80 crore without a tender process, according to a notification issued by the finance department. This is yet to get Cabinet approval, sources said.
“While building the new system, Microsoft will incorporate inputs provided by the government. The system should be simple and clear,” Patil told DH.
Karnataka has been trying to make investments a smooth affair. For example, in 2020-21, the government launched the affidavit-based clearance (ABC) system under which industries can start operations while getting a three-year window to obtain various permits. Apparently, this failed to take off as banks are unwilling to provide loans based on ABC.
At present, Karnataka has a single-window system for business approvals under the Karnataka Udyog Mitra. But the criticism is that the single window leads to many doors. “Also, right now, there’s no hand-holding that’s done once approval is given,” Patil said, adding that the government wants to change this.
Additional Chief Secretary (Finance) L K Atheeq explained the current problem: “Right now, industries can apply online. But rest of the process is not online. Clearances required are sent to the departments concerned manually.”
Atheeq, who is also additional chief secretary to the chief minister, said the new system will take the entire approval process online. “There will be time limits for clearances. If the time limit is not adhered to, a proposal will be deemed approved,” he said.
‘Deemed approval’ means that if a proposal is not cleared within the stipulated time, it is deemed to be approved.
Patil is also thinking of bringing permit-granting agencies under one roof to expedite industrial clearances, like the Inter-Departmental Committee that exists under Tamil Nadu’s Guidance.
The government is revamping the existing investment facilitation mechanism by studying “best in class” agencies such as Guidance (Tamil Nadu), Invest India, Invest Chile, Singapore Economic Development Board and Invest South Africa.