Indian Industry

The July 1996 issue of the official organ of the British Institute of Management, London, Management Today, editorially underlined and sounded a warning that in the highly unpredictable business environment, economic patterns became increasingly fluky. The challenges of the free market and keen competition have made many an organisation run for cover rather than stand up to the challenge and face the odds. The market forces which several of the industry groups and organisations were espousing earlier had now become a bone of contention for them. With regard to Indian industries, in recent years many workers have been rendered surplus. The productional economies have, however, not yet recorded much perceivable real improvement, while the woes of several have multiplied. Taking all this into view there are three questions that come to mind. For whose benefit is all this hullabaloo of opening up directed? Who, in the long run, will constitute the market where goods are sold and profits are earned? If purchasing power is not spread, how can the economy be sustained? None of these questions has been answered properly. Nor are the answers easy without a total overhaul of the framework of policy and sensitive action. With the onset of liberalisation and deregulation, the sudden exposure has shaken the Indian industries to their fundamentals. A new consciousness and a fresh introspection have dawned in the industrial scene regarding the hazards likely to come up and the ways of dealing with them. ‘Survival of the fittest’ sounds easier uttered than achieved, particularly because of the gargantuan stakes all around and their varied import. It is in this context that governments and public agencies have been seeking to enforce the rules of competition with the help and effective intervention of the courts of law. To make sure that every player respects the rules of the game is, however, turning out to be a lot more difficult than imagined.

The spread of the arms of the law is sought to be extended by way of enacting new laws in line with the new aura of openness and gradual slackening of the executive vigil, as also unbridled competition. The ways of the ‘fish-world’ are being witnessed in an increasing number of instances. In such a situation more often than not, somebody’s gain invariably turns into somebody else’s loss, in a sort of zero-sum game. When this process continues uninterrupted, competition not only loses its sharp edge, but also results in much unaccounted loss of ventures and other resources. While it is possible to cushion the untoward effects through an effective network of social security measures and renewal funds in the advanced countries, it becomes costly in the labour-surplus economies of the developing countries. As a matter of fact, there is little use in averring that competition would chastise the weak by bidding it goodbye and the reign of the fittest would be ushered in as a direct consequence. The history of anti-monopoly legislation in the US and the UK and the numerous cases decided by law courts in those countries could not guarantee perfect competition in the market and on different counts, both laws and the law courts have been only chasing the miscreants without being able to prevent monopolistic practices altogether. The recent Microsoft case illustrates the point.