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Centre to act tough on cartelisation in steel: Kamal Nath

— PHOTO: V. SUDERSHAN

CONTROLLING PRICES: The Union Minister for Commerce and Industry, Kamal Nath (right), being welcomed by H. P. Singhania, Senior Vice-President, FICCI, at a seminar in New Delhi on Saturday.

NEW DELHI: The Central Government on Saturday held out a stern warning to steel producers and freight operators that it will come down heavily to prevent cartelisation by them. It has expressed the hope that Competition Commission of India (CCI), which is to become operational soon, will help stop these malpractices.

Sounding the warning during FICCI and CII organised interactions with the industry on the supplementary Foreign Trade Policy here, Union Commerce Minister, Kamal Nath, said, “The CCI is falling into place. There is cartelisation taking place in the country in freight rates and steel prices. This is happening... government has to respond commensurately.”

While asserting that the government would take measures to stop cartelisation across sectors, he asked the industry to inform the government about the difficulties arising out of an increase in prices in certain sectors.

Incidentally, last month, anti-monopoly watchdog MRTPC had directed a probe by its investigative unit DGIR after it got input on price rigging in the steel sector.

Besides this, the government had already taken various measures to control the rising inflation, the latest being withdrawal of export incentives on primary steel products.

It has also slapped a ban on export of cement.

However, Mr. Kamal Nath clarified that the ban on cement exports, announced to check rising prices, would not impact the Special Economic Zones which are considered to be bonded territories by the customs authorities.

“No, the ban will not impact the SEZs,” he said acknowledging that there was confusion whether the sale of cement from the ‘Domestic Tariff Area’ to SEZs would attract the ban.

Asked whether a similar ban on steel export was under consideration of the government, Mr. Kamal Nath said the Steel Ministry was working on the specific steps. The decision would be taken by the Cabinet Committee on Prices meeting next week.

On export target, the Minister said the economy had adequate momentum to sustain the growth rate of 22-23 per cent in the export sector. “If we maintain the same growth rate or raise it by one or two per cent, we will reach $200 billion,” he said.

Mr. Kamal Nath also said that the government had decided to set up a joint venture company with industry body FICCI for encouraging investment. The company would be set up in the next two months.

“The Invest India Company, a joint venture between the Department of Industrial Policy and Promotion and FICCI, would be funded by the Government and managed by the chamber,” he said.

The foreign trade policy review initiatives, he said, were aimed at enlarging India’s trade basket with the inclusion of high value-added manufactured products and items such as fruits and vegetables.

“We invite suggestions from industry within 15 days on the Focus Product and Focus Market schemes announced in the trade policy review,” Mr. Kamal Nath said.

Meanwhile, Commerce Secretary, Gopal Pillai, said the joint task force to draw a strategy for developing world-class infrastructure for exports would be functional in the next 30 days and would represent all stakeholders like industry and governments at the Central and State level.

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