Sitharaman concerned about possible threat from cartelisation
Minister of Finance and Corporate Affairs Nirmala Sitharaman has told the Competition Commission of India (CCI) to have a proactive understanding of what is shaping markets in this process, especially in Merger & Acquisition segment while companies are scaling as a recovery from pandemic-hit businesses.
The call was part of the three actionable areas highlighted by the Minister on 20 May 2022 to achieve the public policy goal of competition.
Secondly, the Minister said that, in today’s context, when the government is pushing infrastructure growth to scale up demand, there is a possibility of threat from cartelisation.
She underlined her concerns that input costs are rising despite India having a huge capacity to cater to both domestic and export demands.
Sitharaman highlighted that there is a global shortage of commodities due to the pandemic, and now, following the war in Eastern Europe, the supply chain has been adversely affected.
She said that there is a need to look into these and ensure that there are no monopolistic and or duopolistic tendencies leading to price rise and supply side manipulations.
Thirdly, Sitharaman spoke about the challenges posed by digitisation.
She applauded how India has made a brand name for itself, be it in Fintech or in adopting digital tools such as artificial intelligence and Internet of Things (IoTs), particularly Aadhar, India Stack and other necessary digital public infrastructure support that have been harbingers of the digital revolution.
The Minister called upon CCI to understand the technological nuances of the new digital era and whether these markets are being fairly, effectively and transparently used for the benefit of consumers.
Stressing the importance of transparency, Sitharaman highlighted the benefits of FAQs, which can become a permanent tool of advocacy. These FAQs should be used to disseminate information on a ready-to-use basis.
This, Sitharaman said, would strengthen CCI’s position as a proactive and progressive regulator, and such guidance will help market players take preventive measures.
While appreciating the role of CCI, she urged the commission to be always sensitive but firm in its approach.
Sitharaman participated in the 13th Annual Day commemoration of the CCI and virtually inaugurated regional office at Kolkata, launched an upgraded CCI website and released CCI’s Competition Advocacy Booklets translated into Kannada and Malayalam
Delivering a Special Address, Ministry of Corporate Affairs Secretary Rajesh Verma said that CCI has made tremendous efforts to build a culture of competition in markets.
He stated that competition law is a critical component of any economic regulatory architecture and infuses dynamic efficiencies.
Verma further mentioned that the common ideological thread of economic regulation in India has unequivocally been competition-based economic regulation.
While sectoral regulations aim to structure a particular sector, the role of CCI is very important to regulate the process of competition in all aspects of the Indian market.
He also outlined the robustness of the Competition Act, 2002, and various remedial measures that can be taken by CCI, but stressed that these powers be used judiciously.
Verma also noted the critical interventions in antitrust enforcement done by CCI over the years and that stakeholders are increasingly reposing their trust in the Commission as a forum for the redressal of competition-related concerns.
He noted that, within the legal framework of the Act, CCI has already issued some landmark decisions and ordered investigations in technology markets.
He recognised that such cases involve complex technological issues and pose challenges to the enforcer and investigators.
To meet such challenges, CCI will need to keep itself abreast of the developments in these markets and continue to redefine the antitrust toolkit. This, according to Verma, would enable timely and evidence-based interventions and strike a balance, so that efficiency and innovation are not stifled and markets remain free from abuse of market power. fiinews.com
