 "regulations")
The Economic Survey 2025 has suggested that financial sector regulators like the Reserve Bank of India (RBI), Securities and Exchange Board of India (Sebi) and Insurance Regulatory and Development Authority of India (Irdai) set up an independent Regulatory Impact Assessment (RIA) agency.
The survey, presented on Friday, a day ahead of the Union Budget, said this agency can provide an "impartial and objective assessment of the regulatory processes and outcomes, including the economic and social impacts of regulations."
"Such a process would also improve the transparency and responsiveness of regulators," it added.
“One credible approach to RIA would be to set up an independent agency housed inside the regulator to evaluate the regulations from all angles. This agency will report to the board and not to the management. It can provide an impartial and objective assessment of the regulatory processes and outcomes, including the economic and social impacts of regulations,” the Economic Survey noted.
It pointed out that this could reduce compliance burden and cost of compliance for businesses along with improving the quality of regulations and address short-comings.
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“Such a move will signal that regulators are willing to live by the principles they expect regulatory entities to follow. This will strengthen the credibility of the process regulators follow and improve the acceptance of the proposed measures,” it said.
The survey has also called for optimal balance between stability and fostering innovation.
The previous Union Budget had recommended financial sector regulators to include public consultations as part of the regulation making process, issuing subsidiary directions and conducting comprehensive review of existing regulations.
Under the recommendations of ease of doing business, the market regulator has taken a slew of measures like relaxing the processes in the previous financial year.
During its previous board meeting in December, Sebi approved the Procedure for Making, Amending, and Reviewing Regulations, 2024, which mandates proposals suggesting policy changes be published for public feedback for a minimum of 21 days.
The rationale for acceptance or non-acceptance will also be made public.
