With an aim to boost business sentiments in the country, the government has decided to extend the validity period of industrial licence to three years with a provision for further extension of two years. The move is likely to help in expeditious clearance of fresh industrial license applications and the extension of the existing industrial licenses.
However, the government cleared that in the absence of commencement of commercial production, the licence will lapse automatically after five years. The government further notified that in case the company fails to start commercial production of items within three years of issue of licence, the application for extension of licence should be submitted to the concerned administrative ministry, 60 days prior to the expiry of three years period.
As per the World Bank’s report, India ranks at 134th position out of 189 economies in doing business index. However, the government has been taking various measures to improve ranking in ease of doing business. Recently, it has de-licensed several defence products for private sector and has also upgraded the National Industrial Classification Code with a view to make business climate more investor friendly.