Corporate affairs minister Veerappa Moily on Tuesday offered a different solution to tame high inflation: Competition Policy.
The implementation of the proposed reform, which aims to vastly improve the ways of running businesses and better the standards of corporate governance, will bring down the inflation to five to six per cent from the current level of over 9 per cent, he said. Reason: it will break cartels responsible for high prices, he told reporters here on the sidelines of a CII seminar.
Cartelisation was a big challenge to the Competition Act, the minister noted. Reiterating that he wanted the competition policy to be approved by the Cabinet by this year-end, Moily cited examples of countries like the US, Japan and Australia, where the GDP shot up after such a policy was put into place.
The ministry has come out with a draft competition policy and is engaged in stakeholder consultations on the same. Today, Moily is slated to hold consultations with industry representatives in Delhi on September 22, before the draft policy is revised and sent to the Cabinet.
The policy will be guiding principles to boost competition and implement the Competition Act in a better way.
On their part, industry representatives from across sectors in India called for simple regulations and stricter implementations for them.
Lambasting the government over the Corporate Social Responsibility (CSR) policy provision in the Companies Bill, the panelists said that CSR is an irrelevant provision.
Omkar Goswami, chairman, CERG Advisory Private Limited, said the CSR provision is like a tax on profit after tax. “I can say that we are back to the world of the license control and permit raj,” he said.
Wholesale price-based inflation has been running over nine per cent for eight weeks in a row from December last year to July this year, despite 11 policy rate rises by the Reserve Bank of India. Moily also said a bill on public procurement was likely to be introduced in the winter session of Parliament in December.
Public procurement is highly criticised by various quarters for breeding corruption and for its opaqueness. To tackle these issues, the government had earlier appointed a committee to go into public procurement policy under the chairmanship of former bureaucrat Vinod Dhall.
Among other issues, the committee had recommended a comprehensive public procurement law to clearly demarcate powers and responsibilities of various authorities and ensure full transparency to reduce corruption.
Last week, an Empowered Group of Ministers had accepted the report.
