The Competition Commission of India (CCI) announced on Nov 3 the launch of a pan-India market study on the cement sector, whose players have frequently been accused of forming cartels to influence pricing, in order to develop a comprehensive understanding of the sector and the state of competition in it.
The study, however, will be independent of any case proceedings before the CCI pertaining to cement firms' anti-competitive behaviour, according to the CCI.
“Given the criticality of cement for many vital sectors, a well-functioning and competitive cement market is of utmost importance. In view of the same and given the structural features of cement market that make it susceptible to collusion, the market study will be a fact-finding exercise to develop comprehensive understanding of the functioning of cement market across regions in India, and the state of competition therein,” the regulator said in a statement.
Regulators have frequently targeted cement companies. The CCI discovered last year that more than a dozen cement manufacturers had been conspiring for years to raise prices and restrict supplies. In 2016, the regulator imposed a Rs 6,714 crore fine on 11 cement companies and their lobbying group, the Cement Manufacturers Association (CMA), for alleged cartelisation. It ordered ten companies to pay Rs 6,317 crore in 2012 after the Builders Association of India accused them of price fixing.
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