Lobby groups close ranks to squeeze out Competition Bill
Kona truck terminal in limbo

From Jayanta Roy Chowdhury New Delhi, Dec 23: A Cabinet move to clear a new competition law has been thwarted due to hectic lobbying by industry groups and strident opposition from, of all people, former finance secretary and currently Planning Commission member Montek Singh Ahluwalia.

Despite lobbying by the Federation of Indian Chambers of Commerce and Industry (Ficci) and the Confederation of Indian Industry (CII) against its introduction in the current form, which they feel is too harsh, the BJP government had made up its mind to formally clear it at a Cabinet meeting and introduce it in the last week of the winter session of Parliament.

The Bill was meant to lessen bureaucratic red-tape, scrap the toothless MRTPC and replace it with a more powerful Competition Commission with powers to safeguard consumers from over-powerful monopolies or cartels abusing their market powers. But opposition from �market forces� of a different nature in the form a sudden missive from the original proponent of economic reforms, Ahluwalia, to law minister Arun Jaitley seems to have put paid to it.

Ahluwalia in his rather long letter to Jaitley attacked the very idea of reigning in monopolies. �It may be better to allow or even encourage consolidation among domestic producers creating fewer large Indian players who can hold their own in the world.�

Obviously this seems to have appealed to the �swadeshi� brand of economics that the BJP government holds dear to its heart.

The former finance secretary who still wields considerable clout within the administration as the original theoritecian of economic reforms seems to feel mere reliance �on import competition to avoid abuse of dominance� by local monopolies would suffice.

Furious department of company affairs officials who have been working on the drafting of the Bill point out that this takes it for granted that consumers can continue to suffer just because �some lala has to be promoted in the world market.�

Besides, their contention is that Ahluwalia simply did not bother about the fact that in the current globalised scenario, the bigger danger came from creation of monopolies outside the borders of India with repercussions here. �For instance, if Pepsi is bought up by Coca-Cola worldwide, can you realise what this would mean to the domestic cola market here? Total dominance by just one player, who can dictate price, supply, everything.�

Their point is that the Competition Commission, which Ahluwalia has decried in his letter as the �ghost of the MRTP,� could, in such cases, step in to dictate pricing policy or to order the newly created global cola power to sell off part of its assets here to other players.

Officials point out that Ahluwalia�s letter mirrors the opposition which chambers have been voicing. �Ficci in a note submitted to the government says virtually the same thing, that in the present state of economic development, what the country needs is further liberalisation and not reintroduction of controls.�

�We don�t doubt there can be improvements to the law and we welcome them, but to say there is no need to check creation of dominant companies which �would be in a position to abuse their clout� or that there is no need for a commission which could protect consumers from predatory pricing is �anti-consumer,� they contend.

Further, they add that even in Western countries, before large scale mergers or takeovers are allowed, these are studied and if felt potentially dangerous for consumers, orders to pare down the newly created strength are passed. Even Ahluwalia has in his letter admitted that �It is true that the UK and US have such laws.�

The Plan body member apparently has gone on to argue that such laws in India�s case would hurt the possibility of getting more investment and that he doubted any emerging market country seeking investments have laws of this type.

The point now, company affairs officials say, is for the BJP government to decide whether they are �any emerging market country,� or a sovereign nation willing to protect its own consumers as well as any developed state would.


Calcutta, Dec 23: 
The much-talked about truck terminal project at Kona, off the Bombay Road, has been given a quiet burial.

Instead, West Bengal Transport Infrastructure Development Corporation � which would have implemented the project � will team up with Howrah real estate developer Ram Ratan Chaudhry as a minority partner to set up a truck terminal and commercial complex on a 250-acre plot at Dhulagar.

Located off the National Highway 6, the terminal will accommodate 2,000 heavy and 1,800 light commercial vehicles. The transport infrastructure corporation will pick up 10 per cent in the project, to be executed by the Calcutta-Mumbai Truck Terminal Limited. State transport minister Subhash Chakraborty will lay the foundation stone for the project today.

The Kona truck-terminal project, one of the oldest planned by the Calcutta Metropolitan Development Authority, was conceived in the early 70s to ease transport bottlenecks in Howrah and Calcutta. The World Bank had agreed to fund the project to be carried out under the Congress government headed by chief minister S S Ray. But land acquisition and bureaucratic inertia delayed implementation during the past three decades before it was buried. Other factors which prejudiced the project were its distance from the railway terminal and the fact that it was proposed right on the National Highway.

Over 6,000 trucks enter the city daily, creating congestion and pollution in Howrah, and the main commodity wholesale market in Burrabazar.

The land for the Dhulagar truck terminal project, less than 20 kms from Calcutta on Domjur Road, off the NH 6, is owned by promoter, Chaudhry, and the site is close to two railway goods terminals, Abada and Sankrail stations, on South Eastern Railway.

The blueprint drawn up envisages an entire range of facilities for transport operators and businesses.


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