Exclusive | Government plans to shut down 'redundant bodies' to rationalise cost

Economic activity across India has taken a hit due to the ongoing COVID-19 pandemic. Businesses and industries have remained shuttered for over two months now amid the ongoing nationwide lockdown. Even as restrictions have been eased across some parts of the country, especially with respect to domestic travel and business operations, states with a higher case burden are struggling to deal with the crisis. Highlighting the grave economic impact of COVID-19, CRISIL has said India is staring at its worst recession since Independence. Here are its impact on key indicators:

As part of the larger plan to tackle the economic fallout of the COVID-19 pandemic, the government is planning to shut down almost a dozen autonomous bodies to rationalise costs.

Some of the autonomous bodies that might be shut down are the National Productivity Council (NPC) and the Tariff Commission, among others, Moneycontrol has learnt.

"The National Productivity Council employs about two hundred people and literally nobody in the government knows what it does," a senior government official told Moneycontrol.

NPC, established in the year 1958, is an autonomous organisation under Department for Promotion of Industry and Internal Trade. Besides undertaking research in the area of productivity, NPC has been providing consultancy and training services in areas of industrial engineering, agri-business, and economic services, among others.

"Tariff Commission isn't a body for tariff for imports. This is a socialist era council that used to set the rates for steel, coal, etc. That institution still exists. It employs about 100 people," the official said.

An independent Tariff Commission was established in 1997. The commission was constituted for recommending appropriate levels of tariffs for different products and different industries, keeping in view the larger economic interests of the country. The committee functions as an independent expert body and has the necessary flexibility to sub-contract research work to specialised agencies, both within and outside the government.

"The plan is to shut down dozens of such autonomous bodies. These are archaic institutions and have become useless. There's potential to rationalise cost if we do away with such bodies," the official said.

The Union Textile Ministry in August abolished the All India Handicrafts Board and the All India Handloom Board — advisory bodies that were created to help the government in “formulation of the overall development programmes” in the handicrafts and handloom sectors, “keeping in view socio-economic cultural and artistic perspective.”

This was followed up with abolishing another advisory body - the Cotton Advisory Board. The government also notified that all eight Textiles Research Associations have ceased to be ''affiliated bodies'' of the ministry.

The Cotton Advisory Board was a representative body of government agencies, growers, industry and trade that advised the government on matters pertaining to production, consumption and marketing of cotton. It was also a forum for liaison among the cotton textile mill industry, growers, the cotton trade and the government.

"In consonance with the Government of India vision of 'Minimum Government and Maximum Governance', a leaner Government Machinery and the need for systematic rationalisation of Government bodies, the Government of India has abolished Cotton Advisory Board with effect from the date of issue of this resolution," the ministry had said in a statement.

The ministry also notified that Textiles Research Associations shall hereafter be ''approved bodies'' for conducting testing, research and developmental activities related to the textiles sector.

Two public sector undertakings under the ministry of textile — the British India Corporation and the Handicrafts and Handlooms Exports Corporation of India — have been reportedly proposed to be shut down, and a Cabinet note for the same has been circulated.