Newsletter August 2026

Dear Friends,

Greetings from the Centre for Regulatory Governance.

Two events over the past few weeks have shown us where regulatory roles in governance work, and where they fall short. The first of them was the student agitation over the conduct of exams. The other is that of biofuels.

The conduct of exams and their eco system is veritably a part of the democratic contract that people have assigned to themselves. Democratic societies swear by the role of merit to decide on the choice of everything. Merit guides who will rise to the top in business, sports or academics; merit guides the selection of entrepreneurs to provide a plate of goods and services, merit also determines the choice of political representatives. For those who cannot step onto the ladder of merit, societies carve out reservations to help them eventually step onto the ladder. 

An exam system is therefore not just a matter of who secures what rank, but an affirmation of the play of merit. It is a sacred covenant between those who administer the exams and those who appear for it, replacing the days of feudal and colonial selections which were determined as favours. 

The literature on regulatory governance tells us that this is a responsibility that a state cannot outsource. It could ask an agency to conduct it, like the National Testing Agency, but cannot outsource the sanctity of the process. An agency could offer technical advice about how to maintain the process, but it is not where the responsibility stops. If more police, or more tech or more money is needed, the state has to provide them without demur. The process is a contract between the state and the people. The incessant reports of cheating, of mischief in determining the results, and so many others were therefore read by the young citizens of the country as a breakage of this democratic covenant. 

The justification of a regulator is that the entity doesn’t have a skin in the game. In the process of exams, the state instead must have a skin in the game. So, any problems in the process cannot be set right by a regulator or by extending the remit of anyone. The political executive has to satisfy the people that exams will be honest and discover true merit. Just as law and order or labour welfare cannot be performed by a regulator.

On the other hand, the problem of biofuel is an out an out a technological challenge. Do vehicles built with the current technology survive well in a fuel that is less fossil and more plant-based? These are issues which can only be discovered by a team of technologists. The citizens too are asking for the same. 

These sorts of questions must be answered only by a regulator. As an example, the answer to whether a Covid vaccine was safe had to be answered by a team of medical and bioscience specialists, and not by legislators. 

To the ethanol question, if we find there is no regulator, then it automatically makes clear the need for one to be set up or the remit of a regulators in an adjacent sector to be expanded. 

Unfortunately, this process has been reversed with several ministries responding on the ethanol issue and none picking up the gauntlet for exams. Yet, these are the questions whose clear answers go a long way to establish the issues for the citizens to be satisfied. Meanwhile, as always, here is a data set to end this Newsletter.

Distribution of Performance Indicators Across Sub-sectors (as on 16th July, 2026)

Source: Factsheet Details - PIB

With Regards

Subhomoy Bhattacharjee

The Regulatory space for the month of July 2026 was marked by significant policies, regulatory, and industrial developments. These spanned across sectors like AI, energy, agriculture, finance, and technology in India. Collectively, these initiatives reflect a strong push towards India increasingly prioritizing domestic control and systemic coordination to safeguard its long-term strategic interests.

ARTIFICIAL INTELLIGENCE:  A commentary on the AI sector in India highlights how strict data governance and digital trust regulations have been viewed by many Indian startups as their main hurdle in operations. It reported on its impact in diverting vital capital and time away from core product development and how that could adversely affect India's push for a competitive "Sovereign AI".

More discussions among CRG panellists on the AI sector, focussed on the impact the decision of the Govt will have, as it indicates a shift away from a decentralized regulatory approach toward drafting a standalone, sector-neutral AI bill.

In a report that mentions the repercussions of India falling behind in the AI technology, global brokerage firm Bernstein has warned that India could face AI blackout if it does not build its own "sovereign AI stack". It discusses where India is lagging behind and why it is so vulnerable and what could be the possible solutions to the issues India is currently facing.

SEBI: SEBI introduced more reforms aimed at improving market efficiency, easing compliance and strengthening investor protection. This time, the focus was on open market buybacks, Mutual funds, AIF schemes, Municipal bond and focus on easier transmission of securities after death.

FSSAI and BIS: As per a report by Indian Council for Research on International Economic Relations (ICRIER), the Indian Spices market has the potential to more than double to $13 billion by 2034 if regulatory gaps are closed. The issues faced and the remedies are discussed in detail in the report.

POWER SECTOR: There were 2 articles on the energy sector - one, where the Indian National Science Academy (INSA) advocates for a Unified National Energy Policy Framework based on four pillars: Adequacy, Access, Affordability, and Sustainability. The other, where it discusses whether the "vintage" label for India's thermal (coal) plants is misleading or not, due to its inability to meet the demand during evenings. These articles assume significance as India scales up its power sector to meet the increasing demand from various areas, as the Central Electricity Authority (CEA) also issues draft procedures and reporting formats for mandatory external safety audits of Battery Energy Storage System (BESS) installations. Continuing on the energy sector, a thought-provoking article focusses on how Brazil's successful ethanol model offers valuable lessons for India.

IBBI: In a view to streamline India's Corporate Insolvency Resolution Process (CIRP) by plugging regulatory gaps, expediting property/asset valuations, and eliminating procedural delays, the Insolvency and Bankruptcy Board of India (IBBI) has released a discussion paper.

CDSCO: Despite initiatives taken in many regulatory sectors, an article highlights why the Central Drugs Standard Control Organisation lags behind India's fast-growing pharma and clean mobility industries due to bureaucratic delays and understaffing, and what could be the recommended solutions. 

The detailed reports and discussions by our CRG panellists analyzing the reports are captured in our website: https://crg.jgu.edu.in/.