.png)
BETTER RULES, BETTER RESULTS: THE POWER OF GOOD REGULATORY PRACTICES
- Unique Law
- Jun 21
- 6 min read
Updated: Jun 22
INTRODUCTIONIf regulations govern society, who governs the regulations? Regulations shape every facet of our social, economic and political life. Regulatory principles aim to maximise the public welfare and serve the public interest. Regulations differ across different jurisdictions. It is because countries often have different public policies, domestic objectives and approaches to fulfil them. These differences reflect the unique context and development goals of each nation.
However regulatory diversity presents challenges for trade and cooperation in an increasingly interconnected global economy. Therefore, Good Regulatory Practice (GRP) becomes essential not only to enhance domestic regulatory quality but also to facilitate international alignment and transparency. Many Free Trade Agreements (FTAs) now explicitly incorporate GRP requirements as part of their commitments.
India’s growing engagement in FTAs with partners like the UK, EU and Australia has made GRP increasingly relevant. While India has embraced the principles of GRP promoting transparency, stakeholder engagement, evidence-based policy-making and periodic review to enhance the quality of regulation. However, the absence of binding legal mandates and the discretionary nature of public consultation severely undermine these goals.
The piece explores these challenges focusing on how India’s regulatory framework falls short in enforcing accountability and meaningful public participation through various provisions, acts and statutes. The discussion aims to highlight the urgent need for stronger legal foundations and institutional reforms to ensure that regulations not only govern society but are themselves governed effectively.
GRP: PRINCIPLES AND PURPOSEGood Regulatory Practices (GRP) refers to a formalized and mandatory government policy that defines the common and transparent rules by which regulatory agencies develop technical regulations for all regulated sectors following international standards. It ensures that regulatory systems are transparent, efficient and responsive.
They are grounded in principles such as legality, consistency with existing policies, institutional independence and impartiality in treatment of all stakeholders. GRP promotes proportional, risk-based regulation, flexibility to adapt to changing circumstances and clarity in requirements. They also emphasize structured consultations, regulatory impact analysis, alignment with international standards, independent judicial review and periodic retrospective evaluation.
This collaborative approach strengthens the legitimacy and impact of regulatory measures leading to more sustainable and resilient outcomes.
REGULATORY FRAMEWORK IN INDIAWhile India does not have any codified GRP guidelines, various elements are embedded within different statutes, policies and regulatory acts.
The guidelines clearly specify that “Every Department/Ministry shall proactively publish the proposed legislations both on the internet as also through other means.” It also mandates publication of the draft legislation to include brief justification, essential elements and financial implications. It should be followed by explanatory note in a simple language. It ensures transparency, stakeholder involvement and structured consultation.
Sec 4 of RTI Act, 2005 mandates every public authority to maintain all records and publish it to provide as much information suo motu to the public at regular intervals through various means of communications, including internet. Section 6 also gives every citizen the right to request information from a public authority.
Paragraph 6 of notification requires application seeking prior environment clearance. Paragraph 7 mandates public consultation through public hearing and written requirements where concerns affecting local population are taken into consideration.
Article 32 and 226 enables citizens to challenge arbitrary, illegal or unfair regulatory actions in court. It ensures judicial independent review.
Article 77(3) enshrines "The President shall make rules for the more convenient transaction of the business of the Government of India, and for the allocation among Ministers of the said business."
Sec 149 lists duties and power of the comptroller and audit- general. It strengthens institutional checks on regulatory and financial governance.
Sec 166(3) enshrines “The Governor shall make rules for the more convenient transaction of the business of the Government of the State, and for the allocation among Ministers of the said business.
Sec 324 lays down guidelines for establishment, role and responsibilities of Election Commission. It sets precedents for establishment of independent central regulatory body.
Section 11(1)(a) mandates TRAI to make recommendations on matters such as the need for new service providers and terms of licenses. Section 11(1)(b)(viii) requires TRAI to maintain a register of interconnect agreements and make it open for public inspection. It mandates public access to interconnection agreements, promoting openness and reducing monopolistic practices.
Sec 3 of SEBI Act establishes SEBI as the regulatory authority. It ensures a dedicated and autonomous regulatory body for capital markets. Sec 11(3) enshrines the power to call for information, conduct inquiries, audits and inspections. It thus provides tools to verify compliance and detect malpractices. Section 31 mandates that “Every rule and every regulation made under this Act shall be laid, before each House of Parliament, while it is in session”. It ensures scrutiny and regulatory analysis. It also follows a review process including soliciting public feedback and amending existing regulations to ensure the market's stability and integrity.
Section 53 mandates every rule made by central government to be laid before parliament. Section 11 mandates that all clinical establishments must be provisionally registered with the relevant authority. This ensures a unified and regulated system for healthcare service providers promoting regulatory coherence.
Section 12.8 mandates that all periodical reports and returns should be reviewed at the level of Joint Secretary or above every three years. It regulates periodic review and evaluation.
STRUCTURAL AND OPERATIONAL BARRIERS1. Lack of Uniform Legal Mandate
Most GRP principles are policy-driven or advisory and not statutory requirements. Agencies and departments often treat GRP guidelines as voluntary best practices. Moreover, there is no independent regulatory oversight body to ensure compliance or penalize non-adherence.
2. Discretionary Nature of Public Consultation
Public and stakeholder consultations are often left to the discretion of regulators, with no mandatory procedural safeguards or minimum standards specified in law. Agencies decide if, when and how to consult, which groups to invite and how to incorporate feedback. There is no clear legal mechanism to compel regulators to respond to or act on public recommendations. Critical voices, especially from marginalized or less organized groups, may be excluded or ignored. It leads to regulatory capture risks where powerful industry players dominate consultation outcomes.
3. Inadequate Capacity and Resources
Many regulatory bodies and government departments lack technical expertise, skilled personnel and data systems to conduct rigorous impact assessments or continuous evaluations. Low investment in training and institutional capacity-building hampers quality regulation. Regulatory independence is sometimes compromised due to political influence or bureaucratic inertia.
4. Incomplete Stakeholder Engagement
Public consultations are often tokenistic and not fully inclusive or transparent. Furthermore, Civil society, small businesses and marginalized groups may lack access or awareness to participate effectively. While policies encourage periodic review, actual systematic retrospective evaluation and sunset reviews are rare. It results in persistence of outdated or redundant regulations.
5. Lack of Binding Language in statutes
Many GRP guidelines and frameworks in India are issued as policies, executive orders or administrative manuals rather than as binding statutes. For example, RIA, periodic reviews and stakeholder consultations are often recommended practices without mandatory legal force. Regulatory bodies may choose to ignore or partially comply with GRP guidelines leading to inconsistent application.
RECOMMENDATIONS TOWARDS ROBUST REGULATORY ARCHITECTURE1. Codify a Central Regulatory Policy Framework
Adopt a national regulatory policy that outlines principles for clarity, coherence, necessity and proportionality in regulation is need of the hour. Technology could be used to improve access to laws, regulations and public comments. A unified online regulatory portal with searchable databases of laws and draft regulations could be launched.
2. Institutionalize Regulatory Impact Assessment (RIA)
RIAs for all major regulations before they are enacted should be mandated. This includes cost-benefit analysis, stakeholder impact and risk assessment. A GRP Cell under NITI Aayog or the Cabinet Secretariat is needed. A Central Regulatory Oversight Body to review regulations periodically for relevance and effectiveness could be established.
3. Enhance Stakeholder Consultation Mechanisms
The use of online platforms such as MyGov, ministry portals and other government-backed digital tools presents a transformative opportunity to enable real-time feedback from citizens during regulatory consultations. These platforms facilitate broader participation by reducing logistical barriers and allowing stakeholders from across the country to voice their opinions, suggestions and concerns on draft laws, policies or amendments.
4. Promote International Regulatory Cooperation
Indian regulations need to align with international standards to boost trade and investment. Mutual recognition agreements and harmonize standards in key sectors (e.g., pharmaceuticals, food safety, digital) should be adopted.
5. Periodic Review and Sunset Clauses
Mandatory review mechanisms and sunset clauses to phase out obsolete or ineffective regulations should be introduced. Mechanisms for regulatory stocktaking every 5 years could be established.
CONCLUSIONThe inclusion of GRP becomes increasingly widespread and debated as India signs FTA with various countries. FTA in today’s world are not only limited to concerns regarding tariff measures but also non- tariff measures including regulatory coherence, RIA and stakeholder involvement. India has traditionally focussed on merely SPS and TBT measures but GRP aims to broaden the scope inculcating systematic principles beyond sector specific compliance.
There is thus an urgent need to bring changes not only to facilitate compliance with international obligations but also to build a regulator system ensuring transparency, efficiency and predictability. In today’s world adopting GRP is not just a policy choice but a foundational step toward India’s long-term economic resilience and global leadership.
~Authored by Khushi Jain
2nd year B.A.LL.B
Comments