There has been a long-standing demand from industry to remove dual compliance of Environmental Clearance (EC) and Consent to Establish (CTE) for setting up new industries. The Government of India has accepted the same recently via a notification (No. Q-15012/2/2022-CPW-Part(1)/e-240741) released by the Ministry Of Environment, Forests And Climate Change. Hence, the non-polluting “white category” industries will no longer be required to take CTE or Consent to Operate (CTO). The only requirement will be of EC and the industries who have taken EC will not be required to take CTE. This will reduce the compliance burden as well as prevent duplication of approvals. A total of 39 categories of industries will benefit from the exemption of the mandatory requirement of approaching State pollution control boards for permission to run their industries.
Central Pollution Control Board (CPCB) divided industries into different color codes in 2016 wherein the “Red category” encompasses industrial areas with a pollution index of 60 and above, and the “Orange category” are industrial areas with a pollution index of 41 to 59, “Green category” include industrial areas with pollution index of 21 to 40 and the “White category” with industrial areas of pollution index of 0 to 20. The Pollution Index (PI) of any industrial sector ranges from 0 -100. These Index scores are prepared based on emissions, waste discharge, generation of hazardous waste, and consumption of natural resources. An increase in the value of PI indicates the increasing level of pollution load in the industry. This is the reason, in the above list, ‘red category’ industries are subjected to the strictest scrutiny as the goods being manufactured by them emit the most toxic wastes.
The white category on the other hand is the least polluting industry according to the above classification. These include manufacturing units to make solar cells and modules, wind and hydel power units, fly ash bricks, leather cutting, assembly of air coolers, repairing and servicing, Medical oxygen, Organic and inorganic nutrients (by physical mixing), Organic manure (manual mixing), Packing of powdered milk, Paper pins and u clips, Repairing of electric motors and generators (dry mechanical process), Diesel pump repairing and servicing (complete mechanical dry process), Electric lamp (bulb) and CFL manufacturing by assembling only, Electrical and electronic item assembling (completely dry process), Engineering and fabrication units (dry process without any heat treatment/metal surface finishing operations/painting), Flavoured betel nuts production/grinding (completely dry mechanical operations) etc. The current exemption from dual requirements aligns with India’s broader environmental objectives like the National Action Plan on Climate Change (NAPCC) and the Paris Agreement to reduce emissions intensity and increase non-fossil fuel energy sources. There is no doubt that the policy reflects a growing emphasis on balancing economic growth with ecological sustainability to foster an environment conducive to green technologies while addressing pollution control through existing frameworks, however, critics have expressed concerns over the wider impact of the policy on the environment, humans as well as economy.
In order to understand the negative side of the policy it is pertinent to understand the legislative framework in India surrounding the issue. Environmental Clearance (EC) is governed by the Environmental Impact Assessment (EIA) Notification, 2006. This clearance is mandatory for new industrial and development projects. It requires rigorous assessment of potential environmental impacts, including public consultations for certain project categories.
Consent to Establish (CTE) is Issued under the Air (Prevention and Control of Pollution) Act, 1981, and the Water (Prevention and Control of Pollution) Act, 1974. It is granted by State Pollution Control Boards to ensure industries comply with pollution control norms before operations begin. It is a precondition for receiving Consent to Operate (CTO). Prior to these new norms, an amendment was made to the ‘Water Act,’ earlier this year. The Water (Prevention and Control of Pollution) Act, of 1974 prioritized the institutional structure to address water contamination. This led to the creation of Central Pollution Control Boards (CPCB) and State Pollution Control Boards (SPCB) in 1974. These boards monitored and prevented public water resources from getting contaminated by sewage and industrial effluents. As per the Act, the SPCB’s permission was required for establishing any industry or treatment plant, which could discharge sewage into a water body, sewer, or land.
The new norms will reduce approval timelines significantly, aiding the ease of doing business, particularly for startups and MSMEs. By eliminating redundancies, industries can focus more on implementation rather than navigating bureaucratic hurdles. Moreover, simplified processes are likely to attract domestic and foreign investments by improving India's business environment. Earlier, there were imprisonment provisions for minor violations, which were simple infringements and did not lead to any injury to humans or damage to the environment. This often caused harassment to businesses and citizens and was not in consonance with the spirit of ease of living and ease of doing business. However, experts have warned of the negative impacts as well. Critics argue that merging EC and CTE processes may dilute pollution control oversight, particularly in states with limited monitoring capacities. Also, ensuring strict adherence to EC conditions without the CTE as an additional checkpoint might strain regulatory bodies. At a time when the air pollution season is at its peak in the country with some states like Delhi crossing severe levels and world leaders pondering over climate protection parameters in the Conference of Parties (COP29) meeting in Baku, the Environment Ministry’s step allowing ‘white category’ sector to establish and operate industries without obtaining two major approvals will not only send a wrong message, but also infringe letter and spirit of environmental action. Nonetheless, the removal of dual compliance for EC and CTE represents a bold step towards regulatory reform, reflecting the government’s commitment to reducing bureaucratic inefficiencies while balancing environmental responsibilities. However, the success of this policy will hinge on effective monitoring and robust enforcement mechanisms to prevent any compromise in environmental standards.