The proposed national competition policy rollout, which has been in the works for over two years, may see further delay with no resolution of inter-ministerial differences on who will drive its implementation and which departments and ministries will need to be kept out of its purview.
The draft policy has been under the scrutiny of a committee of secretaries where the department of industrial policy and promotions (DIPP) and ministries such as commerce, defence, railways and finance have expressed their views that they should be kept out of its provisions, government sources said.
The national competition policy, among other things, proposes to establish a cabinet committee on competition to help align policies of various ministries and departments to enhance competition in all sectors, including matters between the central and state governments. The move, according to officials in the corporate affairs ministry, will, for example, help in checking the food prices by easing supply-side constraints.
“DIPP, defence ministry and even departments within the finance ministry have raised concerns on a blanket applicability of such a policy that may severely impact procurement-related orders of the government itself,” a senior official privy to the ongoing deliberations said. “One view is to keep certain ministries and departments out of its ambit. Then the question of which ministry will drive its implementation has also generated queries and concerns from several quarters. The policy is still far for being adopted,” the official said.
Mooted under the corporate affairs ministry in 2007, the national competition policy aims to remove anti-competition outcome of existing laws between Centre and states. It also looks to proactively promote competition principles with an overall aim of making India one single national market.
Sources said DIPP and a few other departments have raised points on the overlap of powers between the proposed cabinet committee on competition and the existing cabinet committee on economic affairs (CCEA). For all matters involving finance and economy, the CCEA is the highest body within the Cabinet.
In December 2012, corporate affairs minister Sachin Pilot said: “With a view to make the ?culture of competition? an intrinsic part of governance at each tier of administration – Centre, state or local body, the government is considering bringing out a national competition policy, which is at the stage of finalisation.” Later, in August this year, Parliament was informed that the policy is with a committee of secretaries.
Recently, chairman of the anti-trust body CCI, Ashok Chawla, batted for the adoption of the national competition policy stating it was important to adopt the policy in the country where the state still play a major role in the economic sectors. “The policy paradigm in the liberalised era still has a tilt towards control by the state,” he said.