Raichur MP Urges Periodic CCI Market Studies to Prevent Excessive Concentration
Raichur MP G. Kumar Naik has called upon the Union government and the Competition Commission of India (CCI) to conduct periodic market studies in strategically important sectors to prevent excessive market concentration and protect consumer interests, employment, and micro, small and medium enterprises (MSMEs).
In a statement issued on Monday, Mr. Naik said that in response to a question raised by him in Parliament, the government informed him that while the CCI had conducted a comprehensive market study of the telecom sector during 2020-21, it had not undertaken a similar sector-wide study of concentration or oligopolistic trends in the cement industry.
Mr. Naik noted that both the telecom and cement sectors have witnessed significant consolidation over the years. “While the telecom sector has shrunk from more than 13 mobile operators to four major players following mergers and market exits, the cement industry has also become increasingly concentrated, with UltraTech Cement and the Adani Group accounting for a substantial market share in several regions,” he said.
According to the government’s reply, the CCI examined 29 merger cases in the telecom sector and 15 in the cement sector over the past decade, besides ordering investigations and passing enforcement orders. The telecom market study concluded that the existing level of vertical integration was generally perceived by stakeholders as pro-competitive and not posing any immediate competition concerns.
However, Mr. Naik contended that consolidation in the telecom sector has affected employment, public finances, and consumers. Citing reports, he said the disruption led to job losses, mounting industry debt, and concerns over rising tariffs and service quality. He also cautioned that increasing vertical integration across production, logistics, distribution, and retail could make it difficult for smaller firms to compete as critical infrastructure and supply chains come under the control of a few dominant players.
Stating that reactive, case-by-case scrutiny is insufficient to address the risks posed by market concentration, Mr. Naik urged the government and the CCI to institutionalise periodic market studies in key sectors, including cement. He said competition policy should proactively protect consumers, preserve jobs, and ensure a level playing field for MSMEs and smaller enterprises.
