NHAI may close delayed GQ projects
Indian Express

The Golden Quadrilateral (GQ) project to connect Delhi, Mumbai, Chennai and Kolkata with 5,846 km-long four-laned national highways, once known as the 'showpiece' project for its implementing agency, National Highways Authority of India (NHAI), is fast becoming an embarrassment. Dogged by unending delays, the GQ is running far behind its schedule and the NHAI now plans to propose to its high-powered board to close all lingering GQ project by June 2008, if work on them is not completed.

"There is a definite slowdown on GQ projects and very soon a proposal will be moved to the board to take strict action against contractors on the delayed sections. The plan is to close all lingering projects by June next year if they are not completed by then. There are some 15 projects on GQ that are delayed and these are spread across 230 kms, creating uncomfortable two-lane pockets across largely four-laned highways," said a senior official from the Ministry of Shipping, Road Transport & Highways.

"While projects which were recently terminated and re-awarded will drag on quite longer and will push back 100% completion of GQ to another two years or so, we want to fold up existing projects that are heavily delayed and hence, this decision to take the issue to the board," added the official.

The NHAI board has the organisation's chairman and technical/ administrative members as its full-time members and Member Secretary Planning Commission, Secretary Finance Ministry and Secretary Ministry of Shipping, Road Transport & Highways as part-time members.
The 25 projects in the red include those which were cancelled and then re-awarded about one-and-a-half years back. In its latest monthly progress report, NHAI has listed 22 projects along GQ that should have been completed by now but are still pending. Seven contracts have been terminated along the corridor earlier. Work is underway across 217 km on 25 contracts and barely eight km were four-laned on GQ in November 2007. GQ was 96.3% four-laned across 5,629 km, as on November 30 this year. Land acquisition issues continue to plague the project with 8,362 hectares yet to be acquired in several states.

The report shows that a mere 21 km - spread between 13 contracts - have reported 75-100% progress, whereas 105 km - across nine contracts - still showed 50-75% progress and 63 km have reported below 25% progress as on October 31, 2007. NHAI expects 23 projects, including the lingering ones and the recently re-awarded ones, to be completed between December 2007 and June 2008.

Cement cos guilty of cartelisation: MRTPC
Business Standard

The Monopolies and Restrictive Trade Practices Commission (MRTPC) has found 44 cement companies, including biggies like Larsen & Toubro Cement, Birla Cement, Grasim and Associated Cement Company, guilty of cartelisation under the aegis of the Cement Manufacturers’ Association (CMA) between February and April 1990.

The Commission had began inquiries in October 12, 1990, after its investigative wing, the Director General of Investigation and Registration (DGIR), had alleged that the cement companies were involved in possible cartelisation.

The government also took notice of the development. Commerce and Industry Minister Kamal Nath said his ministry would look into the matter. “Cartelisation affects consumers; we will look into it,” Nath said.

Reacting to the Commission’s order, CMA president and the managing director of Shree Cement, HM Bangur, said: “We respect the Commission’s decision but our future course of action will be decided after a detailed study of the report.”

The Commission also agreed with the report of the DGIR that stated the prices were determined by the CMA in different states on the basis of prevailing market conditions through the local management of manufacturers. In its order today, the MRTPC has warned the cement producers and the CMA not to repeat the trade practice.

However, the order is unlikely to impact the cement firms much. “Under Section 37 of the MRTP Act, the Commission can only direct that the practice should be discontinued or not repeated, other than this the Commission is powerless to do anything against the companies forming a cartel,” said Naveen Goel, a corporate law expert.

Analysts too said the judgement would have little impact on the stock prices of the cement firms and also on future price hikes as the case was about two decades old and a near-term price hike was inevitable due to increase in raw material costs.

Centre will look into cement cartelization
Financial Express

The Centre has said it will probe cartelisation charges against the cement industry in the wake of anti-monopoly watchdog MRTPC pronouncing 44 manufacturers, including ACC, L&T Cement, Grasim and Birla Cement guilty of unfair trade practices.
“Cartelisation affects consumers, we will look into it,” commerce and industry Kamal Nath told reporters here on Thursday.
Earlier during the day, following a 17-year-old investigation, the Monopolies and Restrictive Trade Practices Commission held the cement majors guilty of cartelisation under the aegis of Cement Manufacturers’ Association and warned them against repeating such unfair trade practices.

A three-member bench comprising Justice O P Dwivedi, M M K Sardana and D C Gupta said “we issue a cease and desist order... and direct them not to indulge in any such arrangement directly or working through CMA.”
The commission also directed the cement Companies, also involving Century, Dalmia, Jaypee and Mysore, to file a compliance report within eight weeks. “In the present case, we have found direct as well as indirect evidence of concert. The existence of a common platform in the form of respondent Number 1 (CMA), which frequently reviews the price-situation is a strong pointer towards existence of a cartel,” the Commission said.

“Admittedly, respondent No 1 has been fixing prices during the control regime. The same apparatus continues even now without any change. In this scenario, the simultaneous and frequent rise in prices by the respondents, although within a narrow band, would clearly indicate that the respondents acted in a concert,” said MRTPC while slamming the CMA.
CMA said they would respect the commission’s decision and would decide on their future course of action after studying the order.
Earlier too the Centre had cautioned cement Companies against any efforts to cartelise the sector. The Centre had said it would take the necessary steps to make sure that prices of the building material are not “artificially jacked up”.

“The cement Companies should know that the government is not helpless and it will intervene if there are any indications that the Companies are resorting to cartelisation,” minister of state for industry Ashwani Kumar had said.
Kumar added that during the recent meetings with the Companies in the sector, the government asked the Companies to increase production of cement.

Pointing out that the Centre was monitoring the the demand and supply situation in the market, Kumar said, “We have also directed the MMTC to import cement to
ensure enough availability of the building material in the domestic market.”
Kumar had said on November 20: “The prices of cement have stabilised to a large extent showing an increase of only 2.67% between March and October 2007.” The average price of cement has gone up to Rs 231 in October 2007 from Rs 158 per bag in December 2005.
To increase the domestic cement supply, the government has cut import duty on cement to zero, done away with countervailing duty and special additional custom duty, apart from permitting MMTC to import the building material.

41 cement firms guilty of ‘cartelisation’: MRTPC
Tribune, 21-12-07

The MRTP Commission today found almost all major cement companies of the country indulging in ‘cartelisation’ to jack up the prices artificially forcing consumers to pay more than the actual rates and issued a stern warning to them not to resort to such unfair trade practice in future.

The Monopolies and Restrictive Trade Practices Commission (MRTPC) also gave freedom to the director-general investigation registration (DGIR), which had filed a complaint against them, to investigate against any company if found indulging in such practice.
As a custodian of public interest, the DGIR might have been updating itself with the international information relating to manuals on ‘investigation of cartels’ brought by the global agencies, the MRTPC said, “Such initiatives would enable the DG to go through the investigations in a systematic manner and pre-arrange to include necessary material which becomes relevant in such inquiries.”

Finding 41 companies companies out of 44 named as respondents in a complaint by the DGIR, as guilty of joining hands to form a “cartel” to jack up cement prices between February and August 1990 when there was an acute cement shortage, a three-member Bench of Monopolies and Restrictive Trade Practice Commission (MRTPC), headed by its chairman O P Dwivedi said they had violated the relevant provisions of the MRTP Act.

“We have come to the conclusion that all the respondents, except a few, have been indulging in restrictive trade practices and have been acting concertedly, exposing themselves to ‘cease and desist’ order from restrictive trade practice,” the Commission said, fully agreeing with senior advocate O P Dua’s detailed arguments to prove how these companies had violated the relevant provisions of the Act.
The 41 companies found indulged in “cartelisation” include cement majors ACC, Andhra Cement, Birla, Dalmia, Ambuja, JK, Jaypee, Lakshmi, Larsen and Toubro, Madras Cement, Modi and Narmada.

Though the complaint was filed in October 1990, when the cement prices had shot up suddenly by about 30 per cent between February and August, it took almost 17 years for the MRTPC to come out with a verdict as the case had lingered on due to a large number of cement companies, 44 in all named as respondents, besides, the CMA.

The MRTPC said the DGIR in its complaint had clearly stated that the cement companies ‘collectively jacked’ the prices from Rs 70 per bag in November 1989 to Rs 78 in March 1990 and from Rs 85 to Rs 90 thereafter till September when the case was filed.
Though the MRTPC had passed an interim order on September 14, 1990, restraining the companies from hiking the prices further, it lifted the ban on January 28, 1991, on DGIR’s submission that no further evidence came across against manufacturers about resorting to unfair trade practice during the pendency of the case. The prices afterwards had increased gradually and at present varied between Rs 240 and Rs 260 per bag for average quality.

However, the Commission exonerated three manufacturers - Jainpur Udyog, Rohtas Industries of Bihar and Texmaco Ltd - out of the 44 companies, holding that no evidence had been found against them.

MRTPC raps 44 cement firms for cartelization
Indian Express

IndustrY titans Birla & Singhania cos, ACC, L&T arm named Competition watchdog MRTPC today hauled up the virtual who’s-who of cement industry, including the Birlas and Singhanias, for manipulating prices, prompting the Government to assure it will examine cartelisation. MRTPC held 44 cement manufacturers, including L&T Cement, Birla Cement, Grasim and ACC, guilty of cartelisation under the aegis of Cement Manufacturers’ Association. Immediately after the judgement, commerce and industry minister Kamal Nath said: “Cartelisation affects consumers, we will look into it.”

Passing a cease and desist order that runs into 130 pages, a three-member bench comprising Justice O P Dwivedi, MM K Sardana and D C Gupta directed the companies not to indulge in any such arrangement directly or through CMA. “In the present case, we have found direct as well as indirect evidence of concert. The existence of a common platform in the form of respondent No 1 (CMA), which frequently reviews the price-situation is a strong pointer towards existence of a cartel,” the Commission said. “Admittedly, respondent No 1 has been fixing prices during the control regime. The same apparatus continues even now without any change. In this scenario, the simultaneous and frequent rise in prices by the respondents, although within a narrow band, would clearly indicate that the respondents acted in a concert,” MRTPC said.

Reacting to the order, CMA President H M Bangur told “We will respect court’s decision and our future course of action will be decided after going through the order.” In the judgement, the Commission agreed with the report submitted by its investigative arm DGIR that said cement prices were determined by CMA in different states on the basis of prevailing market conditions through the local management of manufacturers.

Stockists were given intimation of the prices fixed from time to time, said the DGIR. “We issue a cease and desist order against the respondents and direct them not to indulge in any arrangement directly or indirectly through the instrumentality of CMA or otherwise in fixing the prices of their produce in concert or in follow up of a concert.” The Commission said there was existence of a common platform in the form of CMA, which frequently revised the price-situation and it was “a strong pointer” towards existence of a cartel. “We have come to the conclusion that all the respondents have been indulging in restrictive trade practices and have been acting concertedly,” said the commission, directing them to file an affidavit of compliance of its directions within eight weeks.

During the investigation all the cement companies shied away from presenting agenda and minutes of the meeting of their marketing committee at the Apex level or at the zonal level, MRTPC observed. CMA and cement companies used these committees to fix the price at at retail level in different zones.
MRTPC had started its judicial investigation in October 1990 after issuing notice of inquiry and admitting the investigation report of DGIR.

Cement cartel rigged prices for 17 years
Hindustan Times

The country’s cement industry received a jolt on Thursday when the Monopolies and Restrictive Trade Practices Commission (MRTPC) said it saw a cartel among domestic manufacturers and ordered them to stop acting together to keep prices artificially at high levels. The order holds no punishment for some of the biggest names in the industry, but castigates big companies for acting in unison for 17 years against consumer interest.

“They have been acting concertedly….” The commission said of 41 manufacturers. The ruling is in line with a law that mandates that measures that go against the competitive spirit and consumer interest can be stopped.
Commerce and industry minister Kamal Nath on Thursday said that the government was looking into the MRTPC order. A senior official in a leading cement company said that the industry would abide by the MRTPC order.

“We issue a ‘cease and desist’ order against the respondents…and direct them not to indulge in any arrangement directly or indirectly through the instrumentality of Cement Manufacturers Association (CMA), or otherwise in fixing the prices of their produce in concert or in follow up of a concert,,” the Commission headed by Justice O.P. Dwivedi said.
However, the order that came after 17 long years is unlikely to have any immediate impact on cement prices. The commission observed that there is no fine prescribed nor there is any imprisonment to anybody. “The adverse finding, if proved, is in the nature of showing a yellow card only,” it said.

The commission also directed the cement companies to file a compliance affidavit within eight weeks. The inquiry into possible “cartelisation” was directed at 41 cement companies, including top cement makers Ambuja Cements Ltd, ACC Cements Ltd, India Cements Ltd, Madras Cements Ltd Shree Cement Ltd, Dalmia Cement Ltd and Larsen & Toubro.
The commission, which had initiated inquiry in 1990, said that cement companies have made no effort to justify the price rise on the basis of cost. The MRTPC Director General of Investigations had alleged that the companies were imposing unjustified cost on consumers by way of price manipulation.

Cement manufacturers courted controversy shortly after presentation of the Union budget this year after the government charged them of artificially raising prices.
The price of cement in India has reached a level of around Rs 240 for a 50 kg bag, as compared to the landed cost of imported cement which is expected to be around Rs 170 per 50 kg bag.
Cement manufacturers had increased the prices of cement by Rs 12 per 50 kg following the proposal in the budget to introduce a differential excise tax regime. The government had proposed to reduce the excise duty to Rs 350 from Rs 400 per tonne on cement whose retail price is not more than Rs 190 per 50kg bag. On cement that has a higher retail price, the excise duty was fixed at Rs 600 per tonne.

Cement manufact. guilty of cartelisation: MRTPC
Pioneer

Anti-monopoly watchdog Monopolies and Restrictive Trade Practices Commission (MRTPC) on Thurs held major cement manufacturers, including L&T Cement, Birla Cement, Grasim and ACC, guilty of cartelisation under the aegis of Cement Manufacturer's Association.

Announcing its order after 17 years judicial investigation, the commission warned the cement producers and Cement Manufacturers' Association not to repeat the unfair trade practice.

"We issue a cease and desist order... And direct them not to indulge in any such arrangement directly or working through CMA," said a three-member bench consisting Justice OP Dwivedi, MMK Sardana and DC Gupta.

Passing the order the MRTPC also directed the cement companies, also involving Century, Dalmia, Jaypee and Mysore, to file a compliance report within eight weeks.