EDITORIAL : THE HINDU, INDIA

It pays to be patient

For the loved ones of the 164 people who died in the 26/11 attacks, the arrest of Zabiuddin Ansari marks a small step forward in the slow march of justice. Mr. Ansari is alleged by India’s intelligence services to have been one of six men who guided the actions of a control team in Karachi. His arrest in Saudi Arabia will demonstrate to the masterminds of 26/11 that their crime is not forgotten, and that there will be no impunity. India’s intelligence services deserve credit for patiently pursuing Mr. Ansari — but so do its diplomats and national security strategists. India’s hunt for the perpetrators of 26/11 has met with more success than any past transnational terrorism investigation because of adroit use of the country’s geostrategic influence. New Delhi has succeeded in pushing the United States to take its counter-terrorism concerns seriously, hammering home the issue’s centrality to the relationship. Riyadh’s increasing cooperation with Indian counter-terrorism interests is also driven by its appreciation of the realities of a changing world. India, with China, will be among the kingdom’s principal energy markets in coming decades. More important, Saudi diplomats wish to wean India away from its long-standing relationship with their key regional adversary, Iran. There is one place, though, which remains shut off from the evolving international consensus on terrorism — and that is Pakistan, where 26/11’s key architects live.

There are three things India ought to do to deal with this situation. First, its high officials must resist the temptation to engage in the kinds of media-driven verbal India-Pakistan mud-wrestling that has periodically broken out over the 26/11 case. It has long been clear that powerful figures in Pakistan’s intelligence services had at least something to do with the attacks; it is unlikely that the country’s most powerful institution will collaborate in its own prosecution. It is not without reason, after all, that the men who harboured Osama bin Laden in Abbottabad are yet to be identified. Secondly, India must conduct the prosecution of Mr. Ansari as transparently as possible. Ill-advised Mumbai police investigators attempted to frame Indian nationals Sabahuddin Ahmad and Fahim Arshad Ansari for a role in the 26/11 attacks, disgracing themselves in the process. Finally, in years to come, with the influence of jihadist groups in Pakistan waxing, there will be new threats to India. New Delhi must anticipate and counter these threats using all tools at its disposal, from enhancing its counter-terrorism capabilities to doing what it can to strengthen the hands of democratic forces across the border.

Welcome assertiveness

The true significance of the Competition Commission of India (CCI)’s recent order penalising 11 major cement companies for violating competition law is to be seen not just in the quantum of penalty, even though at more than Rs.6300 crore it is by far the largest such penalty and one that is sure to dent the profitability of the companies for years to come. By demonstrating its assertiveness in this path breaking order, the CCI hopes firmly to delineate the contours of competition law, which is relatively new to this country. Setting valuable precedents and accumulating case law are important, essential tasks before any regulator. The Competition Act (2002), amended in 2007, prohibits anti-competition agreements and the abuse of dominant position by enterprises, and regulates mergers and acquisitions as well as other forms of combinations in the corporate sector that have, or can have, an adverse impact on competition in India. The CCI has accused the major cement companies of adopting collusive practices, akin to forming cartels to prop up prices. While imposing a stiff penalty, the Commission says it has considered “the parallel and coordinated behaviour of cement companies on price, dispatch and supplies in the market.” Further, that even when capacity was available they did not increase supply to meet the rising demand. Apart from the fine, the companies were told to “cease and desist” from indulging in any anti-competition activity.

The cement companies are sure to go on appeal but even in these early days it is clear that they will cite the lack of direct evidence pointing to collusion. Their supporting arguments are likely to be equally familiar: that input costs covering raw materials, freight fuel and power have been going up across the country. Besides, the industry is very large and forming cartels when there are so many players is neither easy nor sustainable. All of these arguments can be rebutted but it is for the courts to pronounce a final verdict. The order against cement companies is the fourth major order by the CCI. Earlier, two entities, the real estate major DLF and the National Stock Exchange of India Ltd. (NSE) were found to have abused their dominant position and slapped with hefty fines. In the third case, three suppliers of aluminum phosphide, used in storing cereals, were fined Rs.318 crore for colluding with one another in a practice very similar to that of the cement firms. Although located in different parts of the country and having varying cost structures, these firms charged their major buyer, the Food Corporation of India, a uniformly high rate. The battle for an effective competition law has begun in earnest. The CCI’s assertiveness is a welcome sign.