Transparency in decision making: An analysis of the foreign investment approval process in India

Foreign investment approval decision making should strive for a balance between flexibility and certainty. This balance can be achieved by adopting different strategies towards two elements of approval decision making i.e. the identification of the decision makers and the decision making process itself. Regarding the identification of decision makers, the law should clearly state who the decision makers are. The more specific the law in this respect, the better. Nothing makes a process more uncertain and less transparent than a situation in which the investor does not know who really takes decisions on his applications.; Regarding the decision making process itself, the nature of the process demands a different approach. Here, the law should give maximum flexibility to the approval authority in deciding whether the investment is beneficial to the Indian economy. Therefore, the law should necessarily describe this process in wide and general terms.; One should also acknowledge the fact that the norm of transparency is always complementary to the larger goal of balancing encouragement of foreign investment with national policy goals. (Abstract shortened by UMI.)...