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Competition policy is an integral part
of economic policy. The main objective
of competition policy and law is to
preserve and promote competition as a
means to ensure efficient allocation
of resources in an economy, resulting
in the best possible choice of
quality, the lowest prices and
adequate supplies to consumers. To put
it differently, ensuring competition
is just a means to achieve the
above-stated objectives.
There are
complex inter-relationships between
competition and other public policies.
This factor has a direct bearing on
the extent to which competition policy
objectives can be pursued without
being constrained by or conflicting
with other public policy objectives.
Thus, even in the absence of a
competition law or a stated
competition policy, many of the
related concerns can be addressed, at
least partially, if there are other
policies, which are favourable to
competition.
Different
government policies such as trade
policy, industrial policy, regulatory
reforms, etc. may encourage or
adversely affect competition and hence
consumer welfare, particularly, in the
context of the present globalising
environment. In addition
sector-specific policies on health,
electricity, telecommunications,
financial services etc., also affect
competition in the economy. Thus,
although a competition law may be
quite narrow in its scope, competition
policy is much more broad and
comprehensive in its scope and tries
to bring harmony in all the Government
policies that may encourage or
adversely affect competition and
consumer welfare.
India does
not have a competition policy but only
a competition law, first in the form
of the Monopolies and Restrictive
Trade Practices (MRTP) Act, 1969 and
now the recently enacted Competition
Act, 2002. Concerns have been
expressed that a lack of awareness
about competition policy, and the
nature and extent of prevalence of
different types of anti-competitive
practices in India will pose a major
challenge.
Unfortunately, there has not been much
research on competition issues in
India. In the past, efforts have been
made by the Indian Institute of
Management, Ahmedabad and CUTS,
Jaipur. While the IIMA study did not
go beyond policy level, a study by
CUTS done under the 7-Up Project [1]
revealed a crying need to do deeper
research in some sectors, which
display typically anti-competitive
behaviour: cement; trucking; services
such as cable TV etc.
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