Chandigarh Now Faster Smoother Approvals For Msmes

The Centre has extended the Punjab Right to Business Act, 2020 to Chandigarh that aims to ease compliance requirements for micro, small and medium enterprises (MSMEs) and create a more investor-friendly environment in the Union Territory. The move introduces a streamlined, digital, and time-bound system for granting approvals to enterprises.In terms of sectoral composition, MSMEs in Chandigarh broadly fall into three categories – services, trading, and manufacturing. Among these, services form the largest segment, followed by trading, while manufacturing has a comparatively smaller presence.Chandigarh currently has around 65,000 MSMEs, the majority of which fall under the micro category and are concentrated in the services and trading sectors.Despite the large number of registered units, industry stakeholders had previously pointed to regulatory hurdles and high-entry barriers as key factors that limited their growth and discouraged new enterprises from setting up operations in the city. Even small compliance hurdles tend to disproportionately affect these small, service-based enterprises.Chandigarh bureau of enterprise, investment to act as nodal agencyThe Act provides for the establishment of the Chandigarh Bureau of Enterprise and Investment, which will function as the central nodal agency for facilitating businesses.Headed by the UT industries secretary, the bureau will facilitate filing of declarations and approvals, maintain records of application, ensure expeditious clearance of investment proposals, coordinate with UT and central departments and address grievances of enterprises.“This reform empowers MSMEs to undertake business activities of their choice without unnecessary restrictions. For long, enterprises were constrained by rigid, plot-based regulations and dogmatic local policies. The move is a progressive step that will usher in a more vibrant and dynamic business environment, further opening avenues for trade, commerce and industry,” said Pankaj Khanna, industrialist and a former member of the advisory council.Single-window systemA key provision of the Act is the mandatory single-window clearance system, under which all processes from filing declarations to approvals, inspections, and grievance redressal will be conducted online through a designated portal. It will integrate approvals across multiple departments under a single framework, including building plan sanctions and occupancy certificates, fire safety NOCs, factory licences and labour registrations, pollution control clearances, electricity and water connections.Self-declaration systemUnder the Act, businesses can begin the process through a Declaration of Intent, a self-certification mechanism containing relevant project details. Based on this, authorities issue a Certificate of In-Principle Approval, which acts as a deemed approval for multiple regulatory permissions. This certificate remains valid for three years and six months, allowing enterprises to commence operations while obtaining final clearances.Time-bound approvalsThe Act lays down strict timelines for approvals within 5 working days for units in approved industrial parks, within 15-18 working days for units outside such areas. If authorities fail to decide within the prescribed period, approvals will be automatically deemed to have been granted, a provision aimed at curbing bureaucratic delays.Restriction on inspectionsThe law significantly limits inspections during the validity of the in-principle approval. There will be no routine inspections allowed and will be permitted only in case of serious complaints, with written justification by senior officers. Inspection reports must be uploaded within 48 working hours, ensuring transparency.“For its effective implementation on the ground, industrial areas must be brought under the administrative control of the industries department, with the district industries centre acting as the single nodal authority for all industry-related matters. Additionally, regular meetings of the single window committee are essential to ensure time-bound resolution of issues across departments,” said Naveen Manglani, spokesperson and vice-president, Chamber of Chandigarh Industries.