India Needs a Genuine Anti-Trust Legislation to Control Corporate Monopolies

The present regime only promotes corporate monopolies and allows them to exert their corporate clout on everything including politics, writes K Raveendran.

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The erstwhile Monopolies and Restrictive Trade Practices Commission was denounced by all shades of liberal opinion as an integral part of licence raj. However, despite the expressed intent of preventing monopolies, as the entity's name suggested, India's major corporate houses flourished as monopolies under its regime. 

Apparently, the law restricted only new players from entering their preferred business, rather than obstructing the expansion of existing monopolies into any sphere of activity at will.

The story with the Competition Commission of India is not very different.  

The Competition Act of 2002, the Indian version of the anti-trust law of western democracies, does not mind if corporates attain dominance in any particular area. This is unlike the western laws which view every move by companies to consolidate their position with suspicion. 

The Indian law is not bothered about dominance by any player, and the objection is only for the use of an entity's dominance to control the market and manipulate prices of their products and services.

Despite the so-called 'turbo-charged' anti-competition law, Indian corporates have grown into the likes of Korean chaebols, which have been associated with everything that is undesirable in corporate clout, including politics, policy formulation as well as the evolution of the country's industrial and business eco-system.

'Salt to Steel' is a nice catch line associated with Tatas for long, but it is a gross understatement of what the leading conglomerate is all about. There is hardly an activity that one can cite, where a group entity is not present. 

And yet, Tatas are not the best representation for an Indian corporate poking into every possible economic activity. In this respect, the Tata group pales into insignificance when compared to Mukesh Ambani's Reliance, the stranglehold of which has not even spared the branch owned by brother Anil Ambani.

It is for no reason that the farmers agitating against the Modi government's new farm laws have turned their ire against Reliance. Some 1,600 towers owned by Reliance Jio in Punjab have been vandalised by the agitators to protest against the corporatisation of agriculture as envisaged by the government's new farm laws. One of the most serious grievances of the farmers against the new laws is that these are meant to bring prosperity to corporates rather than provide benefits to the farming community.

Reliance's footprint in the country's agricultural sector is relatively new, but that is no indication of the sweep of its presence. In fact, Reliance's hold on the agriculture sector has already become all-pervading, with no specific sphere or activity spared. Reliance's all-encompassing 'farm-to-fork business' envisages a delivery cycle from harvest to the store by sourcing nearly half of all vegetables and fruits required for its retail chain. This has grown by leaps and bounds through meticulously planned acquisitions, handing over the entire business to the group on a platter. 

As much as 90 percent of the country's agritech is believed to be in the hands of Reliance. 

Reliance is now drawing up big plans to leverage its new partnership with Facebook to further consolidate its agritech business with the JioKrishi app, which will offer farm-to-fork supply chain support as well as data analytics. JioKrishi will help farmers undertake precision farming based on big data analysis. The app will alert the farmers about the best time to sow, irrigate and fertilise their crops so as to increase productivity and yield.

So, when farmers see the Reliance communication towers as the symbol of corporate tyranny into their domain, the emotional quotient of their action is not difficult to imagine, although this may not be the most constructive way of expressing their frustration. 

There are also political undertones to the complaint, with Reliance Infocomm alleging that the police of the government of the opposition-ruled state is following a deliberate policy of remaining silent spectator to the vandalism. State governor V P Singh Badnore has intervened on behalf of Reliance to summon state chief secretary and police chief to the Raj Bhavan to record his serious concern about the problem.

While Rahul Gandhi's 'Ambani-Adani' refrain may have become a cliché due to its overuse in and out of context to denounce Modi, he is not far from the truth. The two groups are lionising all business deals under the Modi government. We have seen how the management of the country's major airports have been handed over to the Adanis, although they have no experience whatsoever in running an airport. 

Examples of such crony capitalism abound if one were to analyse all the deals entered into by the government over the past few years. (IPA Service)

(K Raveendran is a senior journalist. Views are personal.)