TheInvestment Climate Reform Unit (ICRU) was established under the Jobs & Competiveness program, collaboration between the Punjab Government and the World Bank Group, to lead, implement and coordinate interventions for improving investment climate in the Punjab.
ICRU is mandated to improve investment climate and create an enabling business environment to ensure that existing businesses flourish while attractive investment opportunities can be availed by new businesses.
The following are the core functions of The Investment Climate Reform Unit (ICRU).
Public Private Dialogue (PPD) is a structured dialogue process that facilitates a better diagnosis of investment climate problems, improved design of policy reforms and efficient implementation of these policy reforms. Through such efforts, representation of the private sector in policy making and legislative reform dialogues is assured. It is recognized as a key feature in the improvement of business climate and reformation of governance structures. PPD aims to promote the right policy and regulatory mix to enable sustainable growth and equitable development.
PPD Council: The PPD council is the apex body to steer all matters pertaining to all PPDs in Punjab. The council is authorized to approve all recommendations/proposals submitted by the PPD unit and provide recommendations to the provincial government regarding policy, regulations and institutional support mechanisms. Working groups: Working groups are comprised of private sector stakeholders ranging from various industries and sectors and have balanced representation from the public and private sectors to develop a meaningful dialogue process. Secretariat: ICRU is the secretariat to the PPD Council. The PPD It is a dedicated setup to coordinate and facilitate overall PPD initiatives. The secretariat takes forward recommendations to the Council based on the outcomes of working group dialogue.
Strategic Investment Initiatives (SII) refers to specific initiatives that are taken to stimulate investment and business activity in target sectors through highly focused Sophisticated-Investment-Vehicles.
It is pertinent to note that it is the responsibility of the Public Sector to ensure opportunities exist in the economy that focus on improving Access to Finance for all businesses in Punjab and disenfranchised parts of society in the province which have a harder time gathering access to financial institutions. Realizing this essential responsibility, SII will work towards developing a mechanism that furthers public access to deposit, risk management and insurance services to all portions of society.
ICRU recommends the establishment of Sophisticated Investment Vehicles (SIVs) that cater to the financing needs of smaller businesses, women and pre-startup visionaries who cannot fulfill the fiduciary criteria of mainstream banks. ICRU will be signing MoUs and working with NGOs and various business chambers across Punjab to achieve a greater level of financial inclusion with regards to these groups.
ICRU is looking towards institutionalizing a mechanism of “policy driven funds" in Punjab. It is suggested that these funds are structured in a way that the government is a limited partner (LP) and the management of this fund is handed over to notable professionals from the private sector to build its credibility in the market as Patient and Smart Capital.
Initially an exercise will be carried out through the consultants to map the complete list of business regulations rules procedures and processes and number of days required for each step. An extension of the mapping would be with regards to the requirements for women, and time taken when the same regulations are applied to women. ICRU will be the repository of this inventory. Further, the inventory will be made available on ICRU and PBIT websites. All amendments will be updated.
Ease of doing business is an index published by the World Bank. It is an aggregate figure that includes different parameters which define the ease of doing business in a country. The World Bank Group publishes an annual report, which provides objective measures of business regulations for local firms in 190 economies and selected cities at the subnational level. The focus is on regulations in ten separate areas, which are relevant to the life cycle of a small to medium-sized domestic business, with the measurement process built on standardized scenarios. The ten indicators covered are selected areas of the overall business environment. Each indicator is a composite of several separately measured indicators, with the data collected independently, from multiple sources, using standardized methodology. The four indicators which fall under the provincial domain are:
A Comprehensive program of reform activities has been developed to address the regulatory issues in each of the areas, with the planned activities to be supported by inputs and funding provided under the World Bank Group’s Jobs and Competitiveness Program for Results loan project and a DFID funded Investment Climate Technical Assistance project. An overall (composite) target of 14 points (23%) improvement over the five years of the project (over the DB 2016 DTF scores) has been set for the indicators.
This function will not only assess the need as per the impact of upcoming Regulation but also analyze and quantify or measure the real impact and benefit of all the reform that is being undertaken by different arms of the government.
RIA will have a strong data collection and analysis arm, so that all findings and indeed recommendation for future reform are based on a solid base of actual factual information and detailed data. Wider records will be cross referenced and broader data will be collated and mined as per the lens put on to inspect it and perspective taken.
As per the strategy and vision set this will become an important function for the ICRU since we will develop capacity and adopt World Bank procedures and guidelines.
“Aside from the specific recommendations, there are three more fundamental conclusions to be drawn from this research. Government departments need better mandates which go beyond their narrow focus and reflect broader growth aspirations. These mandates need to be supported by incentive structures for employees which are carefully thought through and consider the potential unintended consequences.
Improved mandates should also support improved coordination of policymaking between different stakeholders. Departments need to be better at sharing information, and better coordinated during enforcement.”(Source: BERF Report) This will include creating: