NEW DELHI, DEC 4: Even as the NDA government is all set to place before the cabinet the proposed Competition Bill, the head of the BJP's economic cell, Jagdish Shettigar, has flagged the PM's attention to serious flaws in the Bill which, according to him, will cripple Indian industry at a time when it desparately needs to consolidate to face foreign competition. According to sources, Shettigar has said that though drafted by a panel of legal and other experts, the bill has all the potential of taking Indian industry back to the days of the license-raj. The Bill, for instance, has an archaic limit of Rs 1,000 crore (of assets) after which any group comes under the purview of the Competition Commission. What is Rs 1,000 crore today, is Shettigar's argument - even a 500 MW power plant costs Rs 2,000 crore. So, if the Competition Commission is going to scrutinise even moderate-sized firms, this will take us back to the license raj days. Shettigar is said to have pointed to the fact that there are already several regulatory bodies which look into various aspects of the functioning of companies, including the SEBI which examines takeovers. So what is the need to create a new super-regulatory body when there are different regulatory bodies to protect interests of the consumers in the related fields. Shettigar has also raised objections at the timing of the introduction of bill. According to him, the bill would be an obstacle in the way of attracting private investments in infrastructure projects. When even a midsize power project costs over Rs 2,000 crore, it would not be pertinent to encourage steps to put it under scrutiny for the purpose of competiton. The key member of the PM's Economic Advisory Council has also conveyed to the PM that competiton needs to be relooked in the context of globalisation. According to him, after liberalisation of imports only strong domestic companies would be able to stand up to competiton from foreign companies. In such a scenario it is imperative to promote the domestic companies. However, the new Competition Bill would do exactly the reverse, Shettigar has stated.
