The Financial Express, April 8, 2003
New Delhi, April 7: The Consumer Unity and Trust Society (CUTS), a leading non-government organisation working on trade and economic issues in the country as well as abroad has stated that an effective competition law will make it possible to attain the projected 5-6 per cent annual growth in gross domestic product.
“We have a new and modern competition law. But to get good results we need adequate resources and good professionals to implement the law,” said the organisation secretary-general Pradeep S Mehta here on Monday.
According to a release issued by CUTS, studies have shown that competition law enables the growth process by conserving scarce resources and raising the efficiency in the economy.
A study carried out for the Australian economy in 2000 had estimated that the benefits to be expected from a package of competition promoting deregulatory reforms to incur an annual gain in real GDP of about 5.5 per cent or worth $23 billion.
“The study had showed that consumers gained by almost $9 billion and there was increase in real wages, employment and government revenue,” according to Anjali Bansal, programme officer of CUTS.
In terms of expenditure on the competition regime, the approach has been to provide it with peanuts, the organisation has said in its release. A soon to be published study in Korea establishes that as against the cost of implementing the competition law of $18.4 million in 2001, consumer welfare increased by $527 million through price reduction and increased availability of goods from a monopolistic market structure. The study had also showed that the income transfer effect was about $536 million due to good enforcement of the competition law, said the organisation.