How policies can bypass India's parliament

Vendor in Delhi, 7 Dec
Image caption The retail reform was an executive order that did not need parliament's approval

Last month, the Indian government allowed foreign companies to own 51% of multi-brand retail outlets without referring the decision to the country's highest decision-making body.

This was not the first time a ruling regime had resorted to such practices, either because of an ongoing criticism against a specific move, or fear of a political backlash.

On 26 December 2004, the Congress-led coalition pushed through critical amendments to the existing patents laws through an ordinance, which was later passed by parliament with many amendments.

One of the changes related to the introduction of "product patents" in pharmaceuticals. This gave protection to global drug makers on every aspect of product development - from molecules to micro-organisms, processes and process-innovations.

The earlier system was "process patent", which allowed Indian manufacturers to use slightly different processes to make products patented by foreign firms.

"Product patent" had been opposed by political parties and non-governmental organisations, which claimed that it would make medicines more expensive.

Executive in nature

Similarly this year, days before the government changed its policy on organised retail, it introduced a key bill on pensions in parliament to allow foreign companies to operate in the sector.

However, the cap on foreign investment was not specified in the bill; the government said it would announce it through an executive decision later.

Critics said this was done because of fears of political opposition to the proposed changes.

"Some policies - like sector-specific caps on foreign investment - are executive in nature, and can be announced when the parliament is not in session," says economist Bibek Debroy.

"But if it is done when parliament is in session, the elected legislators should be taken into confidence."

Over the past two decades, constitutional experts have lamented that "there has been a decline in the effectiveness of parliament as an institution of accountability and oversight".

A 2006 paper, by Devesh Kapur and Pratap Bhanu Mehta, called the Indian Parliament as an Institution of Accountability, concluded that while the "weakness of the Indian parliament has… given the executive more powers", it has also resulted in an environment where the "day-to-day parliamentary scrutiny of the executive in financial matters remains weak".

Alam Srinivas is Editorial Consultant, Open, and has written a book on the spat between the two Ambani brothers

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