ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

Aditya BhattacharjeaSubscribe to Aditya Bhattacharjea

Open Letter to Finance Minister

We, the undersigned, are writing to draw your attention to two urgent priorities for the forthcoming budget. (1) Social security pensions: The central government’s contribution to old-age pensions under the National Old Age Pension Scheme (NOAPS) has remained at a measly ₹200 per month since 2006...

Cartels and the Competition Commission

The Competition Commission of India's Rs 6,307 crore fine on 11 major cement manufacturers for cartelisation has been the biggest punishment that the body has imposed since it began functioning in 2008. A study of this and other cases in which the CCI has successfully completed enquiries shows the working of a very different law and commission from that of the earlier MRTP Act. The CCI's successes will hopefully send the right signals to all the stakeholders about the law and the consequences of its violation. However, there is enormous scope for improvement in both the Act and its enforcement before India's competition policy is raised to international standards.

Faltering Growth of South Asia

The Poor Half Billion in South Asia: What Is Holding Back Lagging Regions? edited by Ejaz Ghani (Delhi: Oxford University Press), 2010; pp xviii + 342, Rs 795.

Of Omissions and Commissions:India's Competition Laws

In 2009, India repealed its 40-year-old Monopolies and Restrictive Trade Practices Act, and brought into force most sections of the 2002 Competition Act. After a brief introduction to the basic economic principles underlying modern competition law, this article reviews the country's experience with the MRTP Act. It argues that the way it was structured, amended, interpreted and enforced ensured that it could not really serve as a competition law. Consequently, it did not bequeath a body of expertise that could help in the implementation of its successor, the Competition Act, which is very demanding in terms of economic analysis. The strengths and weaknesses of the new law, the reasons for its delayed implementation, and the first few decisions of the Competition Commission of India are discussed.

The Effects of Employment Protection Legislation on Indian Manufacturing

This paper extends an earlier critique (Bhattacharjea 2006) of the empirical literature on labour regulation and industrial performance in India, but focuses more narrowly on the impact of legal restrictions on layoffs, retrenchment and plant closures. After summarising the earlier paper, the variability of employment protection regimes across Indian states attributable to court judgments, a key factor which other authors have ignored, is described. The earlier literature has also ignored the possibility that firms may adapt to restrictions on labour flexibility via fragmentation and outsourcing of production. Some conclusions of the earlier studies are also undermined by lacunae in the official industrial statistics. The paper concludes by summarising the results of an empirical exercise based on an alternative methodology.

Krugman's Economics: An Introduction

Next week, Paul Krugman will receive the 2008 Nobel Prize for Economics. His work on New Trade Theory and New Economic Geography, for which Krugman has been awarded the Nobel, is explained and discussed in this article.

Are Merger Regulations Diluting Parliamentary Intent?

Summarising the key points from the submissions made to the Competition Commission of India, this article analyses one amendment to the Competition Act that covers the threshold limits of mergers of global companies operating in India which would be covered by the Indian legislation. The proposed changes have not been received well in business and legal circles at home and abroad. Will the government then buckle under pressure from the business and legal communities, thereby diluting parliamentary intent?

Amending India's Competition Act

In March this year the government tabled the Competition (Amendment) Bill 2006, which has been referred to the parliamentary standing committee on finance. Wider discussion is called for, considering that the bill proposes to amend no less than 42 of the 61 sections of the Competition Act, replacing 13 and deleting five sections in their entirety, and introducing what amounts to 21 new sections. These changes not only attempt to address the Supreme Court's objections, but also modify several of the substantive provisions of the act dealing with anti-competitive practices.

Explaining Capitalist Growth

Explaining Capitalist Growth The Free-Market Innovation Machine: Analysing the Growth Miracle of Capitalism by William J Baumol; OUP, New Delhi, 2004 (first published by Princeton University Press, 2002);

Predatory Pricing and Anti-dumping Revisited

Predatory Pricing and Anti-dumping Revisited ADITYA BHATTACHARJEA In a stimulating article, Prabhash Ranjan (

India's Competition Policy: An Assessment

Even as it is confronted with the likelihood of negotiations on competition policy after the Cancun Ministerial of the WTO, India is in transition between its Monopolies and Restrictive Trade Practices (MRTP) Act and the new Competition Act. This paper undertakes a detailed analysis of various aspects of this situation. It first reviews a series of recent judgments of the Supreme Court that have set aside orders of the MRTP Commission, depriving it of extra-territorial jurisdiction and the power to restrict imports, and curbing its tendency to adjudicate 'fair' prices. Section II examines the Competition Act, especially several amendments that were introduced as it was being passed, including one that explicitly arms the Competition Commission with the authority to impose import restrictions, and several others that will be self-defeating or difficult to implement. While these two sections employ standard economic theory and comparisons with contemporary international practice, Section III adopts a more historical approach, examining the political economy of competition policy in various countries, and its limited scope for serving distributional objectives in the Indian context. Section IV argues that the case for a WTO agreement on competition policy is greatly overstated, and that India should ally with other developing countries to block such an agreement. On a more positive note, while amendments to the Competition Act are implied by the analysis of Section II, the two succeeding sections develop criteria for exemptions from its provisions.

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