2.7. Participation of Stakeholders in the Regulatory Process

♤ For the orderly growth of a sector, a regular consultation among the industry, the government, the regulators and other stakeholders such as consumers is essential.

♤ A mechanism for periodic meetings involving these can help the regulator understand stakeholder problems and concerns.

♤ Such forums also enable the regulator to explain the rationale of various regulatory decisions. However, not much thought has been given by most regulators to ensuring a representative consultative process.

♤ There is another very important reason for having a representative regulatory process. In India, regulatory reforms, which have accompanied economic reforms, have been marked by lack of consumer participation.

♤ Consumers, being largely unorganised, have been largely bypassed by the reform process (except in a few cases where consumer concerns have been highlighted by the media), which has been influenced by a strong business lobby.

♤ In India, a few sector regulators such as Central Electricity Regulatory Commission (CERC) and TRAI have created participation mechanisms by constituting Advisory Committees with representation from consumers and other stakeholders. The participation of stakeholders, particularly consumers, can be made very effective through well designed and implemented public meetings along with distribution of accessible literature.

♤ In addition to lack of proper consultation, there is lack of coordination between regulators and government departments, responsible for formulating and implementing investment related policies.

♤ Clear information may empower stakeholders and can inform the decision-making process. However, such information should be taken into account by the regulator while making decisions.

♤ This can be ensured through accurate documentation of consultations and recourse to effective legal action against the regulator to redress bad decisions.