In a major move, the General Financial Rules (GFR) will be modified to facilitate further ease of doing business. The GFR acts as a guiding framework for dealing with financial matters and adherence to it is mandatory.
This comes after an international report ranked India at 130 in the ease of doing business.
According to the World Bank’s Doing Business Report 2016, India now ranks 130 out of 189 countries in the ease of doing business, moving up four places from last year’s adjusted ranking of 134.
“We have decided to revise the GFR as well as the manuals. The draft of both will be put up for public consultations in the month of August itself,” a senior central government official said speaking on condition of anonymity.
The Centre plans to come out with a manual on procurement of goods also, he said. Formulation of a new set of General Financial Rules has been necessitated by numerous changes brought by the Narendra Modi government in existing rules and regulations related to trade, the official said.
The GFR, first issued in 1947, were in the form of executive instructions which were later modified in 1963. Changed economic situation prompted further revision and the last GFR were issued in 2005.
Official sources said the draft of new GFR will be first put up for public consultations and wide-ranging discussions will also be held with Central Vigilance Commission (CVC) and experts.
Over 1,000 archaic and redundant laws have been scrapped by the government. There are a few other rules which need to be revisited as far as financial propriety is concerned and the new GFR, as and when it comes, will be in line with the policy of the government to promote trade and business, the sources said. The CVC is in the process of finalising a discussion paper to look at all the aspects of tendering and will recommend comprehensive guidelines.
About 30 per cent of India’s Gross Domestic Product (GDP) of about Rs 25 lakh crore comes from tendering of goods and services being procured by the government.
(With PTI input)