January 09, 2020
The corruption in an earlier scandalous allocation of mines was another violation
The corruption in an earlier scandalous allocation of mines was another
violation of competition principles by not following competitive bidding. Were
they at fault for doing it Not really, since they were following the government
diktat to coordinate their marketing including to not to poach on each others’
clients. Indeed, a sad example of our government working in silos and selective
amnesia. "When the RBI has deregulated the saving bank interest rate in October,
2011, most banks fixed the same at four per cent. The whole purpose of
deregulation is then lost, and consequently the economy suffers. They claim that
their steel plant would generate much more employment than the power plant, and
that they had also proposed a power plant in their steel conglomerate. United
India won the bid and agreed to share 10 per cent of its profits on this
business with National and New India.com/nflrxf4) which will show the reader the
rainbow lucidly.
These four companies: National, New India, Oriental and United
India had a combined loss of Rs 1,500 crores in 2012 and were fined Rs 671. In
this process some concerns have been raised by companies such as Jindal Steel
who claim to have been discriminated against. The government refuses to break
the monopoly in spite of various demands though some amount of deregulation has
taken place by allocating captive mining to large users with a future provision
of flexibility to sell their surplus production. The other problem is such
anticompetitive practices cannot be challenged under competition rules, because
they are sanctioned by a policy. If only, our draft National Competition Policy
(NCP) is implemented the case load will mainly be of firm level malpractices and
distortions addressed separately. Fortuitously, the CCI has launched such a
programme by inviting research institutions to register with them to carry out
such studies. His successor, Naved Masood commented stoically that "officers
take a stand where they sitâ€. Countless examples exist in our governance such as
SEBI or even the Supreme Court inviting tenders for deposits only from state
owned banks.
Or flying only by Air India when on government business, or
sovereign guarantee to LIC policy holders and not to other private life
insurance companies’ policy holders and so on. Once this programme is set in
motion one can hope to start the corrective processes, subject to the typical
hurdles, and take our economy up a new growth path, or the second big wave of
reforms after 1991. The writer is secretary-general, CUTS International. This
energy behemoth is a government monopoly and lack of competition has made it
complacent. Few days earlier, private sector transmission line companies raised
the issue of nomination to the PSU: Power Grid Corporation without inviting
tenders. After receiving the 11th M.A large number of cases before the
Competition Commission of India show how policy distortions lead to them. Are we
to believe that the cost of deposit mobilisation is the same for all banks —
big, small, public, private, foreign 10mm hex nuts — and
that has remained static since 2011â€, she said. Mittal who had moved from the
department of corporate affairs, where he had launched the efforts for NCP.
A
large number of cases before the Competition Commission of India show how policy
distortions lead to them. One of the recommendations of the NCP is to carry out
competition impact assessment of government policies, laws, regulations and
practices to address the distortions by presenting a cost-benefit analysis. That
has been addressed in cases of private sector by following a public auction
route, though PSUs continue to get them through the nomination route.At CUTS, we
have been documenting such competition distortions in a quarterly dossier
(http://tinyurl. Competitive neutrality is another victim of government policies
and practices where the public sector gets a preferential treatment over the
private sector.
What beats common sense is that if any sector has been
deregulated, the step motherly treatment is a sort of admission that the public
sector needs to be mollycoddled for all the time; competition could go to hell.
It has been covered under the NCP as a recommendation to enable the government
to clean up such policies which distort neutrality.Another policy induced
distortion which landed in the court of CCI is that of abuse of dominance
against Coal India Ltd, when it was fined Rs 1,773 crores. It also carries a
section on food for thought which can be an easy checklist for reviewing the
policy on the touchstone of competition. No case has yet come up before the CCI
but can we believe that the government is not a tacit supporter, because of the
preponderance of public sector banks which occupies over 73 per cent of the
market.05 crores as penalty for bid rigging in a case involving the government
of Kerala’s Rashtriya Swasthya Bima Yojana.
Pai memorial award in early
September, former deputy governor of RBI, Kishori Udeshi came down heavily on
banks for cartelising on saving account interest rates, aided by the Indian
Banks Association.On May 24th, 2012 the department of financial services
directed the four companies to coordinate their marketing activities.Let me take
the case of our four public sector general insurance companies who were recently
hauled up for collusion. (This order has been stayed by the Competition
Appellate Tribunal and the case is still awaiting closure). Jindal Steel’s
complaint is basically on lack of competitive neutrality and particularly to
cancel their coal block allocation in Chattisgarh (won in recent auctions) and
award it to the power sector. The paradox of the government order was that the
then secretary of financial services was Dinesh K.Another example from the
financial services domain is how banks coordinate the interest rates on savings
account.
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