In some other quarters there is an apprehension that this move if upheld by the higher courts may kill individual initiative and thereby retard progress in the information technology industry. However, there is widespread appreciation of the American system which can go even against the highest persons to protect the spirit of competition; and herein lies the message for India.

In India, unfortunately, we do not have an adequate law to protect consumers and weaker players against the actions of powerful corporations. Before the advent of reforms, the Government, in a way, carried out that function by regulating the production ofgoods. When it did so, it ensured that there was no undue concentration of production power with one or a few. Even prices were to some extent regulated and so it was difficult for cartels to be formed for rigging up prices. However with the drastic changes in monopoly legislation and the scrapping of industrial licensing, it is now a free for all; and this means that the more powerful tend to bulldoze the less powerful. Maybe, unwittingly, we have swung from one extreme to the other.

We have allegations of price-fixing coming through frequently. In the cement industry, for instance, builders and contractors in the south are complaining that the big cement manufacturers have ganged up and are cartelising. While I do not know the truth behind the allegations, it is widely seen that there is a significant differential in the cement prices between the south and the other regions. The sad part is that there is no in-built mechanism which can swing into action when something like this takes place in an importantsector like cement which affects the housing for the millions.

We have also had issues of dominance coming up time and again. Reliance - like any other large group anywhere in the world - has been gobbling up polyester firms as if it has gone out of fashion. Even without these acquisitions, the company was a big player in this market and with these acquisitions, it has become even more dominating. The end-users are in a way the common people who wear clothes made of polyester and they have every reason to look for protection against dominance. As the law stands today, Reliance is quite right in buying out weak competition but we need to ensure that strength does not turn into dominance.

We have seen such dominance in items of mass consumption. After the spate of acquisitions and mergers put through by Hindustan Lever, that group has become a big player in packaged tea, ice creams, etc. Of course, they have brought quality to the industry, but the issue is one of creating a framework by which the payingpublic will have a right to question these moves which stifle competition.

A very odd situation has developed in the media industry where one is seeing a different type of assault on the free market and one is offered products free of charge. Just a few days ago I received a copy of Filmfare - a film journal - which was priced at Rs 50. Nothing wrong with that except that I also got a gift along with that which cost Rs 60. Both the price of the magazine and the gift are prominently displayed on the cover. Well, that is not the whole story. My original subscription to Filmfare itself was practically free. I had been given a lovely Siemens phone costing about Rs 2,000 for subscribing to Filmfare and its sister publication Femina.

You may ask what is wrong with this? After all, you are getting things free and you should not be complaining. Except that by doing this Filmfare and similar brands are shutting out those competitors who cannot offer such deals. So very quickly, the choice before the consumer isreduced to just Filmfare and... Filmfare. Sounds very much like George Orwell's 1984, doesn't it? The dangerous part is that this is now spreading to daily newspapers, financial papers, etc. And Microsoft was accused of exactly doing this. By bundling Internet Explorer into the Windows package and in a way offering it free, it was throttling Netscape. The US courts have held that in the long run this kills the element of choice, which is basic to the modern civil society.

The authorities are engaged in an exercise to rewrite the competition law in the country; not a day too soon. For, a fair competition law is the best bulwark against the dominance of the rich and the powerful. That law will hopefully ensure that there is a free market consisting of a number of producers and a number of consumers and the price and quantum of output and sale will depend on one factor; namely the relative position of supply and demand at that point in time.

The author is a Delhi-based investment banker and can be contactedat pnvijay@vsnl.com