New Delhi: Prime Minister Narendra Modi has taken direct control of a project-monitoring body to fast-track investments worth almost $300 billion and revive manufacturing in the country, two officials with direct knowledge of the matter told Reuters.
Pro-business Modi has faced criticism in recent weeks that his ambition to spur investment and re-energise the economy has yet to be realised, more than six months after he won elections with the strongest mandate in three decades.
Industrial output contracted in October in its worst performance in three years, jarring with a much-publicised "Make in India" campaign Modi has championed to make the country a manufacturing powerhouse.
By taking over the Project Monitoring Group (PMG), which was previously in the Cabinet Secretariat, Modi could help firms planning coal, power, steel and infrastructure projects cut through a maze of up to 180 clearances.
"The fact that the prime minister's office (PMO) will be directly overseeing all the project clearances will impart a greater degree of efficiency and also ensure that clearances are fast tracked at every level," said one of the officials, declining to be identified ahead of a public announcement.
"The PMO's stamp will make a big difference."
A PMO official said a bureaucrat who had worked closely with Modi when he was chief minister of Gujarat will head the monitoring group. The senior officer is among a few trusted civil servants with whom the PMO thrashes out key decisions, often at the expense of ministerial authority.
Former Prime Minister Manmohan Singh set up the PMG last year to prod ministers and bureaucrats sitting on files, a tendency that came to be known as "policy paralysis" and was blamed for growth of less than 5 per cent for two straight years.
Since its inception, the PMG has facilitated 197 stalled projects worth about $110 billion.
South Korean steel maker POSCO (005490.KS) is one of many companies to have approached the PMG. POSCO has waited nine years to get approvals to set up a $12 billion steel plant, which would be India's biggest foreign direct investment.
Tata Power (TTPW.NS) and Adani Power (ADAN.NS) are other top companies awaiting clearances.
"Business confidence has certainly improved in the last six to seven months, but this confidence now needs to get translated in the project delivery, kick-starting the investment cycle and boosting consumer demand," said Sunil Kanoria, president-elect of industry body ASSOCHAM.
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