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APRIL 2009
13
Second Administrative Reforms Commission
Government of India
2nd Floor, Vigyan Bhawan Annexe, Maulana Azad Road, New Delhi 110 011
e-mail : arcommission@nic.in    website : http://arc.gov.in
th IRteeNth Repo Rt
Se Cond Adm InIS t RAt Ive RefoR mS Comm ISSIon
oRg AnISA t Ion AL St RuC tu Re of  
g ove Rnment of Ind IA
oR g An ISAt Ion AL St Ru CtuR e of g ove Rnment of Ind IA
Page 2


APRIL 2009
13
Second Administrative Reforms Commission
Government of India
2nd Floor, Vigyan Bhawan Annexe, Maulana Azad Road, New Delhi 110 011
e-mail : arcommission@nic.in    website : http://arc.gov.in
th IRteeNth Repo Rt
Se Cond Adm InIS t RAt Ive RefoR mS Comm ISSIon
oRg AnISA t Ion AL St RuC tu Re of  
g ove Rnment of Ind IA
oR g An ISAt Ion AL St Ru CtuR e of g ove Rnment of Ind IA
GOVERNMENT OF INDIA
SECOND ADMINISTRA TIVE REFORMS COMMISSION
THIRTEENTH REPORT
ORGANIs ATIONAl sTR ucT u RE OF  
GOVERNMENT OF INDIA
APRIl 2009
Page 3


APRIL 2009
13
Second Administrative Reforms Commission
Government of India
2nd Floor, Vigyan Bhawan Annexe, Maulana Azad Road, New Delhi 110 011
e-mail : arcommission@nic.in    website : http://arc.gov.in
th IRteeNth Repo Rt
Se Cond Adm InIS t RAt Ive RefoR mS Comm ISSIon
oRg AnISA t Ion AL St RuC tu Re of  
g ove Rnment of Ind IA
oR g An ISAt Ion AL St Ru CtuR e of g ove Rnment of Ind IA
GOVERNMENT OF INDIA
SECOND ADMINISTRA TIVE REFORMS COMMISSION
THIRTEENTH REPORT
ORGANIs ATIONAl sTR ucT u RE OF  
GOVERNMENT OF INDIA
APRIl 2009
i
Government of India
Ministry of Personnel, Public Grievances & Pensions
Department of Administrative Reforms and Public Grievances
Resolution
New Delhi, the 31st August, 2005
No. K-11022/9/2004-Rc. — The President is pleased to set up a commission of Inquiry 
to be called the s econd Administrative Reforms commission (AR c) to prepare a detailed 
blueprint for revamping the public administration system.
2. The commission will consist of the following :
 (i) shri V eerappa Moily - c hairperson
 (ii) shri V. Ramachandran - Member
 (iii) Dr. A.P. Mukherjee - Member
 (iv) Dr. A.H. Kalro - Member
 (v) Dr. Jayaprakash Narayan - Member*
 (vi) s mt. Vineeta Rai - Member-s ecretary
3. The c ommission will suggest measures to achieve a proactive, responsive, accountable, 
sustainable and efficient administration for the country at all levels of the government.
The commission will, inter alia, consider the following :
(i) Organisational structure of the Government of India
(ii) Ethics in governance
(iii) Refurbishing of Personnel Administration
(iv) s trengthening of Financial Management s ystems
(v) s teps to ensure effective administration at the s tate level
(vi) s teps to ensure effective District Administration
(vii) l ocal s elf-Government/Panchayati Raj Institutions
(viii) s ocial c apital, T rust and Participative public service delivery
(ix) c itizen-centric administration
(x) Promoting e-governance
(xi) Issues of Federal Polity
(xii) c risis Management
(xiii) Public Order
s ome of the issues to be examined under each head are given in the T erms of Reference attached 
Page 4


APRIL 2009
13
Second Administrative Reforms Commission
Government of India
2nd Floor, Vigyan Bhawan Annexe, Maulana Azad Road, New Delhi 110 011
e-mail : arcommission@nic.in    website : http://arc.gov.in
th IRteeNth Repo Rt
Se Cond Adm InIS t RAt Ive RefoR mS Comm ISSIon
oRg AnISA t Ion AL St RuC tu Re of  
g ove Rnment of Ind IA
oR g An ISAt Ion AL St Ru CtuR e of g ove Rnment of Ind IA
GOVERNMENT OF INDIA
SECOND ADMINISTRA TIVE REFORMS COMMISSION
THIRTEENTH REPORT
ORGANIs ATIONAl sTR ucT u RE OF  
GOVERNMENT OF INDIA
APRIl 2009
i
Government of India
Ministry of Personnel, Public Grievances & Pensions
Department of Administrative Reforms and Public Grievances
Resolution
New Delhi, the 31st August, 2005
No. K-11022/9/2004-Rc. — The President is pleased to set up a commission of Inquiry 
to be called the s econd Administrative Reforms commission (AR c) to prepare a detailed 
blueprint for revamping the public administration system.
2. The commission will consist of the following :
 (i) shri V eerappa Moily - c hairperson
 (ii) shri V. Ramachandran - Member
 (iii) Dr. A.P. Mukherjee - Member
 (iv) Dr. A.H. Kalro - Member
 (v) Dr. Jayaprakash Narayan - Member*
 (vi) s mt. Vineeta Rai - Member-s ecretary
3. The c ommission will suggest measures to achieve a proactive, responsive, accountable, 
sustainable and efficient administration for the country at all levels of the government.
The commission will, inter alia, consider the following :
(i) Organisational structure of the Government of India
(ii) Ethics in governance
(iii) Refurbishing of Personnel Administration
(iv) s trengthening of Financial Management s ystems
(v) s teps to ensure effective administration at the s tate level
(vi) s teps to ensure effective District Administration
(vii) l ocal s elf-Government/Panchayati Raj Institutions
(viii) s ocial c apital, T rust and Participative public service delivery
(ix) c itizen-centric administration
(x) Promoting e-governance
(xi) Issues of Federal Polity
(xii) c risis Management
(xiii) Public Order
s ome of the issues to be examined under each head are given in the T erms of Reference attached 
as a s chedule to this Resolution.
4. The commission may exclude from its purview the detailed examination of administration 
of Defence, Railways, External Affairs, s ecurity and Intelligence, as also subjects such as 
c entre-s tate relations, judicial reforms etc. which are already being examined by other bodies. 
The commission will, however, be free to take the problems of these sectors into account in 
recommending re-organisation of the machinery of the Government or of any of its service 
agencies.
5. The commission will give due consideration to the need for consultation with the s tate 
Governments.
6. The c ommission will devise its own procedures (including for consultations with the 
s tate Government as may be considered appropriate by the commission), and may appoint 
committees, consultants/advisers to assist it. The c ommission may take into account the 
existing material and reports available on the subject and consider building upon the same 
rather than attempting to address all the issues ab initio.
7. The Ministries and Departments of the Government of India will furnish such information 
and documents and provide other assistance as may be required by the commission. The 
Government of India trusts that the s tate Governments and all others concerned will extend 
their fullest cooperation and assistance to the commission.
8. The commission will furnish its report(s) to the Ministry of Personnel, Public Grievances 
& Pensions, Government of India, within one year of its constitution.
Sd/-
(P.I. Suvrathan)
Additional Secretary to Government of India
*Dr. Jayaprakash Narayan – Member, resigned with effect from 1st s eptember, 2007
(Resolution No. K.11022/26/207-AR, dated 17th August, 2007).
ii iii
ORGANISATION
Second Administrative Reforms Commission
 1. Dr. M.V eerappa Moily, c hairman*
 2. shri V. Ramachandran, Member**
 3. Dr. A.P. Mukherjee, Member
 4. Dr. A.H. Kalro, Member
 5. Dr. Jayaprakash Narayan, Member***
 6. s mt. Vineeta Rai, Member-s ecretary
Officers of the Commission
 1. shri A.B. Prasad, Additional s ecretary
 2. shri P.s. Kharola, Joint s ecretary#
 3. shri R.K. singh, P s to c hairman#
 4. shri s anjeev Kumar, Director
 5. shri shahi s anjay Kumar, Deputy s ecretary
*Dr. M. V eerappa Moily – c hairman, resigned with effect from 1st April, 2009 
(Resolution No.K-11022/26/2007-AR, dated 1st April, 2009)
**shri V. Ramachandran, was appointed Acting c hairman vide Resolution 
No. K-11022/26/2007-AR, dated 27th April, 2009
***Dr. Jayaprakash Narayan – Member, resigned with effect from 1st s eptember, 2007 (Resolution No.K-
11022/26/2007-AR, dated 17th August, 2007)
# Till 31.03.2009
Page 5


APRIL 2009
13
Second Administrative Reforms Commission
Government of India
2nd Floor, Vigyan Bhawan Annexe, Maulana Azad Road, New Delhi 110 011
e-mail : arcommission@nic.in    website : http://arc.gov.in
th IRteeNth Repo Rt
Se Cond Adm InIS t RAt Ive RefoR mS Comm ISSIon
oRg AnISA t Ion AL St RuC tu Re of  
g ove Rnment of Ind IA
oR g An ISAt Ion AL St Ru CtuR e of g ove Rnment of Ind IA
GOVERNMENT OF INDIA
SECOND ADMINISTRA TIVE REFORMS COMMISSION
THIRTEENTH REPORT
ORGANIs ATIONAl sTR ucT u RE OF  
GOVERNMENT OF INDIA
APRIl 2009
i
Government of India
Ministry of Personnel, Public Grievances & Pensions
Department of Administrative Reforms and Public Grievances
Resolution
New Delhi, the 31st August, 2005
No. K-11022/9/2004-Rc. — The President is pleased to set up a commission of Inquiry 
to be called the s econd Administrative Reforms commission (AR c) to prepare a detailed 
blueprint for revamping the public administration system.
2. The commission will consist of the following :
 (i) shri V eerappa Moily - c hairperson
 (ii) shri V. Ramachandran - Member
 (iii) Dr. A.P. Mukherjee - Member
 (iv) Dr. A.H. Kalro - Member
 (v) Dr. Jayaprakash Narayan - Member*
 (vi) s mt. Vineeta Rai - Member-s ecretary
3. The c ommission will suggest measures to achieve a proactive, responsive, accountable, 
sustainable and efficient administration for the country at all levels of the government.
The commission will, inter alia, consider the following :
(i) Organisational structure of the Government of India
(ii) Ethics in governance
(iii) Refurbishing of Personnel Administration
(iv) s trengthening of Financial Management s ystems
(v) s teps to ensure effective administration at the s tate level
(vi) s teps to ensure effective District Administration
(vii) l ocal s elf-Government/Panchayati Raj Institutions
(viii) s ocial c apital, T rust and Participative public service delivery
(ix) c itizen-centric administration
(x) Promoting e-governance
(xi) Issues of Federal Polity
(xii) c risis Management
(xiii) Public Order
s ome of the issues to be examined under each head are given in the T erms of Reference attached 
as a s chedule to this Resolution.
4. The commission may exclude from its purview the detailed examination of administration 
of Defence, Railways, External Affairs, s ecurity and Intelligence, as also subjects such as 
c entre-s tate relations, judicial reforms etc. which are already being examined by other bodies. 
The commission will, however, be free to take the problems of these sectors into account in 
recommending re-organisation of the machinery of the Government or of any of its service 
agencies.
5. The commission will give due consideration to the need for consultation with the s tate 
Governments.
6. The c ommission will devise its own procedures (including for consultations with the 
s tate Government as may be considered appropriate by the commission), and may appoint 
committees, consultants/advisers to assist it. The c ommission may take into account the 
existing material and reports available on the subject and consider building upon the same 
rather than attempting to address all the issues ab initio.
7. The Ministries and Departments of the Government of India will furnish such information 
and documents and provide other assistance as may be required by the commission. The 
Government of India trusts that the s tate Governments and all others concerned will extend 
their fullest cooperation and assistance to the commission.
8. The commission will furnish its report(s) to the Ministry of Personnel, Public Grievances 
& Pensions, Government of India, within one year of its constitution.
Sd/-
(P.I. Suvrathan)
Additional Secretary to Government of India
*Dr. Jayaprakash Narayan – Member, resigned with effect from 1st s eptember, 2007
(Resolution No. K.11022/26/207-AR, dated 17th August, 2007).
ii iii
ORGANISATION
Second Administrative Reforms Commission
 1. Dr. M.V eerappa Moily, c hairman*
 2. shri V. Ramachandran, Member**
 3. Dr. A.P. Mukherjee, Member
 4. Dr. A.H. Kalro, Member
 5. Dr. Jayaprakash Narayan, Member***
 6. s mt. Vineeta Rai, Member-s ecretary
Officers of the Commission
 1. shri A.B. Prasad, Additional s ecretary
 2. shri P.s. Kharola, Joint s ecretary#
 3. shri R.K. singh, P s to c hairman#
 4. shri s anjeev Kumar, Director
 5. shri shahi s anjay Kumar, Deputy s ecretary
*Dr. M. V eerappa Moily – c hairman, resigned with effect from 1st April, 2009 
(Resolution No.K-11022/26/2007-AR, dated 1st April, 2009)
**shri V. Ramachandran, was appointed Acting c hairman vide Resolution 
No. K-11022/26/2007-AR, dated 27th April, 2009
***Dr. Jayaprakash Narayan – Member, resigned with effect from 1st s eptember, 2007 (Resolution No.K-
11022/26/2007-AR, dated 17th August, 2007)
# Till 31.03.2009
CONTENTS
Chapter 1. Introduction 1
Chapter 2. Reorganising Government - International Experiences 4
 2.1 Background 4
 2.2 Models of Structural Reforms in Government 6
 2.3 Origins of NPM 8 
 2.4 Reforms in Public Administation in UK  15 
 2.5 Reforms in Australia 18 
 2.6 Reforms in Thailand 20 
 2.7 Link between Governance and Growth 23
 2.8 W orld Bank’s Recommendations for Improving  32
  Governance Capacity 
 2.9 Lessons from Some Commonwealth Countries 35 
 2.10 Global Lessons 38
Chapter 3. Existing Structure of Government of India 46
 3.1 Historical Background 46
 3.2 The Constitutional Provisions 47
 3.3 The Structure of a Department 49
 3.4 Reforms since Independance 52
 3.5 Strengths and W eaknesses of the Existing Structure 68 
Chapter 4. Core Principles of Reforming the Structure of Government  71
Chapter 5. The Structure of Government of  India at the Apex  74
 5.1  Rationalising the Functions of Government 74
 5.2 Rationalising the Size of Government 78
 5.3 Reorganising the Ministries and Departments 79
 5.4  Recasting the Allocation of Business Rules 97
 5.5 Ministries and Departments to Primarily Focus on  103
  Policy Analysis
 5.6 Creation of  Effective Executive Agencies 109
 5.7 Internal Reorganisation of  Ministries 119
 5.8 Simplification of Governmental Processes 125
 5.9 Recasting the Manual of Office Procedure 130
 5.10 Coordination Mechanisms 134
 5.11 Reducing Paperwork in Government Offices 138
Chapter 6. Creating an Effective Regulatory Framework 141
 6.1 Introduction 141
 6.2 Regulatory Functions 141
 6.3 The Statutoty Independent Regulatory Agencies 144
 6.4 Issues 149
 Conclusion 159
 Summary of Recommendations 160
iv v
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