Regulating the Regulators

India established several independent regulators in sectors like electricity, telecommunications and insurance after economic liberalisation. This article discusses how these regulators can be effectively scrutinised and oversight by legislative bodies strengthened.

The global surge in independent regulatory agencies is a relatively recent phenomenon in much of the developing world, including India. Originating in the United States (US), the concept of independent regulation spread to the European Union (EU), and to the developing countries in the 1990s. A study (Jordana et al 2011), covering 48 countries and 16 sectors over 88 years (1920–2007), found that the number of new regulators created per year increased from less than five till the 1980s to more than 20 from the 1990s to 2002 (reaching peaks of more than 30 new agencies per year between 1996 and 2001).

What are independent regulators? Mark Thatcher, political scientist at the London School of Economics and Political Science (Thatcher 2002), defined independent regulators as “a body with its own powers and responsibilities given under public law, which is organisationally separate from ministries and is neither directly elected nor managed by elected officials.”