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Department for Promotion of Industry and Internal Trade (DPIIT)
A new January 2026 report titled Adopting Agile Regulatory Governance to Foster Innovation from the APEC Economic Committee underscores that traditional, prescriptive regulatory frameworks are increasingly becoming bottlenecks for rapid technological advancement. The report advocates for Agile Regulatory Governance, a flexible and iterative approach that allows regulators to keep pace with innovation while managing systemic risks. Produced by the Malaysia Productivity Corporation (MPC), the study identifies that while 66% of surveyed APEC economies have begun adopting agile principles, significant gaps remain in institutionalizing these practices beyond temporary pilot projects.
Key Agile Instruments and the Implementation Toolkit The report introduces a standardized Implementation Toolkit designed to guide economies through the practical transition to agile governance:
Regulatory Sandboxes: Enabling businesses to test innovative products in a live, controlled environment with temporary regulatory exemptions to gather empirical evidence on risks and benefits.
Outcome-Based Regulation: Shifting the focus from prescriptive “how-to” rules to defining clear, measurable performance goals, allowing firms the flexibility to choose the most efficient way to comply.
Anticipatory Regulation: Utilizing horizon scanning and foresight tools to identify emerging technologies (e.g., Generative AI, Quantum Computing) and proactively design guardrails before they reach mass-market scale.
Multi-Stakeholder Co-Regulation: Moving toward collaborative models where industry, academia, and civil society co-design standards, ensuring that regulations are technically feasible and socially acceptable.
Navigating Institutional Obstacles Despite the potential, the transition faces recurring obstacles. APEC economies cite limited institutional readiness, capacity constraints, and the difficulty of balancing innovation with public accountability as primary hurdles. The report emphasizes that agile governance is not a “one-size-fits-all” model; it requires a tiered strategy that prioritizes high-impact emerging sectors while maintaining traditional oversight for critical safety and environmental standards.
What is the “Agile Governance Implementation Toolkit” and how does it help regulators? The Implementation Toolkit is a practical reference resource developed to help regulatory bodies assess their current maturity and transition toward more flexible models. It provides step-by-step guidance on establishing sandboxes, drafting outcome-based rules, and setting up cross-border regulatory cooperation frameworks. By using the toolkit, regulators can systematically move away from static, “one-time” rule-making to an iterative process where regulations are continuously refined based on real-world data and feedback loops.
Policy Relevance
The APEC roadmap provides a strategic blueprint for the DPIIT and Indian regulatory bodies to foster a “Viksit Bharat” innovation ecosystem.
Fostering Start-up Resilience: Implementing APEC-style Regulatory Sandboxes can significantly reduce the “compliance cost of failure” for Indian start-ups, allowing them to iterate faster in deep-tech sectors like space and biotech.
Global Regulatory Alignment: Adopting the APEC Toolkit ensures that India’s regulatory standards are interoperable with global benchmarks, facilitating easier market entry for Indian firms into the broader Asia-Pacific region.
Institutional Capacity Building: The report highlights a critical need for “Regulatory Skill-Up” programs; India can leverage these findings to train a new generation of “Agile Regulators” equipped with data analytics and foresight capabilities.
Evidence-Based Policy-Making: Moving toward outcome-based models encourages a shift from “command-and-control” to data-driven governance, where regulatory success is measured by innovation output and safety metrics rather than pure compliance counts.
Follow the full report here: APEC Project Report: Adopting Agile Regulatory Governance to Foster Innovation