MCX has partnered with Dalian Commodity Exchange of China to facilitate potential collaboration in areas such as knowledge sharing, research and price risk management
Multi Commodity Exchange of India Ltd (MCX), the country's largest commodity bourse, said it has signed a memorandum of understanding (MoU) with China-based Dalian Commodity Exchange (DCE) for knowledge sharing, research and price risk management.
In a release, PK Singhal, deputy managing director of MCX said, "As China and India are among the top commodity consuming and producing countries, this alliance will surely go a long way in bringing more mutually beneficial opportunities that would eventually result in creating more efficient markets."
"The futures markets of China and India have a lot in common but with their own characteristics. The mutually beneficial partnership established between the two exchanges will enable us to understand one another's markets, through which we could share expertise and best practices for mutual promotion and progress," said Liu Xingqiang, chairman of DCE.
Indian Railways is witnessing delays in rail projects, mostly created by vested interests leading to increase in costs and corrupt practices
Indian Railways began their chugging career more than 150 years ago and have become one of the largest railroad networks in the world, with a turnover of over $17 billion (2011-12). It is government owned and employs the largest number of Indians in a single government enterprise, with a net work of over 115,000 kms. And it ferries 24 million passengers a day. Apart from extensively covering India, it has limited service to Nepal, Bangladesh and Pakistan.
Recently, the Indian Railways floated a tender for supply of 11728 wagons with the bid closing next week, on 25th November. It may be noted that the last tender called for supply of various types of wagons totalling 15,715, which brought some relief to the Wagon building industry in the country.
For the first time, the bidding this time has to be made in electronic format and the tender calls for supply for carrying cement bags with specific loading and unloading features. This was announced two months ago on 25th October.
In 2011-12, it was reported that the Railways carried 2.8 million tonnes of freight daily and now they are closer to reach 3 million tonnes. However, there is regular shortage of rakes for moving bulk cargo like coal, iron ore etc. In case of coal, in fact, the Railways, in order to ensure timely supply of coal to industries from pit heads to the manufacturers sidings, have also began to lay dedicated corridors in some areas to ensure collection and delivery. They move bulk supply of foodgrains as well, both of which are subject to wastage and pilferage, but these may occur at any point of time but the pity is that the Railways have not yet been able to come out with a pilfer proof wagon that can carry precious cargo.
Wagon builders have idle capacity in their constant search for various export opportunities and are supplying various types of wagons to the exacting international standards, to many countries.
Despite its huge net work and potential, there is no doubt, prima facie, that Railways are not run in an enterprising fashion to earn profits and act like many other successful government companies, some of which have huge and surplus cash reserves.
While Udhampur-Srinagar-Barmullah railway project started in 1955, estimated to cost Rs2,500 crore has run to a staggering Rs17,500 crore and still not completely finished. All these indicate the embodiment of inefficiency and poor responsibility shouldered by all concerned. Delays in project are created by vested interests leading to increase in costs and corrupt practices. Political agitations and terrorist activities across the border, as in the case of some of the affected areas, may be "treated" as force maejure conditions, on which the contractor has no control, but where such conditions do not exist, it is purely due to other reasons cited above.
Almost every of its project has cost over runs and delayed completion by several years, as a result. According to information available in the media some of the prominent projects, such as for the Kudankulam Power plant, approved in 2001 costing Rs4,099 crore eventually cost Rs13,171 crore; the oldest, said to be the Howrah-Apta-Champadanga line was estimated to cost around Rs34 crore reached Rs550 crore - the list is endless.
Another important factor that comes to our mind is the under-utilisation of track, which is not "in use" except for the short duration of time when the train passes through. We do not believe any study has been undertaken to utilise the capacity by increasing the passenger train or freight traffic.
Also, another peculiar phenomenon is the promises made Railway ministers to take care of their constituencies by either increasing or establishing new service and laying tracks for additional lines. Such acts appease their vote banks, in the short run.
So what is the solution to this perennial problem? It is time Government thinks seriously in terms of divesting its interest in Railway ownership by introducing sectional "ownership" by corporate bodies to run certain service operations. It could be from the major city to the point of tourist attraction and once the returns are satisfactory, the idea could be expanded.
If other countries can permit privately operated railroad systems, why not India think on these lines and even come out with an innovative plan?
(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)
It is not really clear as the role the looming deadline of 210 days, barely 15 days away, had played in the majority decision of CCI clearing the Jet and Etihad deal and how much of it was shaped by the consideration of competitive concerns, or lack thereof
On 12 November 2013, the Competition Commission of India (CCI) gave a green signal to Etihad of their 24% acquisition of Jet Airways. The approval order is signed by five members including the CCI chairman. One member has given a dissenting order not agreeing with the majority and directing the Secretary to issue a show cause notice to the parties to the combination, in terms of section 29(1) of Competition Act, 2002 (the Act).
A very interesting component of the dissenting/minority order is contained in paragraph 7 of this minority order. For sake of convenience, paragraph 7 of this dissenting order is being reproduced below:
“As noted earlier, the notice u/s 6(2) of the Act was received by the Commission on 1st May, 2013. However, for the purposes of Section 31(11) (210 days) of the Act, and Regulation 28(6) (180 days) of the Combination Regulations, only 11 days have elapsed so far, in view of the application of Regulation 5(4) and 19(2) of the Combination Regulations, because of the time taken by the parties in furnishing requisite information.”
What is important is that it has been observed in the same paragraph that from the date of filing on 1 May, 2013 that only 11 days have elapsed till the date of order on account of the inordinate time (and ‘time outs’ allowed) taken by the parties to the combination in furnishing the requisite information. If taken to the logical conclusion in the case of combinations to come before CCI in future, this is a very worrisome impression. Because of the filing having been made on 1 May 2013, as given in this dissenting order, the 210 days are going to expire on 27 November 2013. The paragraph 56 of this dissenting order, being significant, is also being reproduced for a ready reference:
“In view of the above, I am of the prima facie opinion that the proposed combination is likely to cause an appreciable adverse effect on competition within the market of international air passenger transportation from and to India. A notice may, therefore, be issued to show cause to the parties to the combination calling upon them to respond within thirty days of the receipt of the notice, as to why investigation in respect of the proposed combination should not be conducted.”
On account of the provisions of ‘time out’ in the regulations and inordinately delay taken by the parties to the combination to furnish the required information which only could help the CCI reach a conclusion about the potential anti-competitive impact of this particular combination, only 11 days out of 210 days for the purposes of section 31(11) of the Act had passed. This order does mention that 210 days are available with CCI for passing an approval order but, almost within the same breath, it says that for the purposes of section 31(11) of the Act, only 11 days have elapsed so far. This is a very interesting formulation. At the end of the period of 210 days, any merger filing is deemed to have been cleared by CCI, if not cleared along with an approval order or otherwise before that. It would have implied that the filing of combination was cleared by default without CCI having to look into the details of the combination or such an examination having any value either.
The above dissent/minority order is right in the sense that the total time available to CCI for clearing any combination is 210 days as given in section 31(11 ) of the Act. It also clarifies that this period of 210 days is further sought to be curtailed to 180 days, as an act of self discipline, in terms of the provisions of the regulation 28(6) of the Combination Regulations. This is the correct position. However, the sanctity of 210 days given in the Act is much more than the limit of 180 days, given in the regulation 28(6). The latter being a part of the subordinate legislation whereas the limit of 210 days being given in the law itself.
Suppose the dissenting order was the majority order, in that event, CCI would have given 30 days to the parties in combination to furnish reply in terms of the show cause notice intended to be given in above paragraph 56 of this minority/dissenting order. It is obvious that by the time the replies of the parties would come before CCI, the time limit of 210 days would have been well over. The question arises, even if not questioned by the parties to the combination, if the replies of the parties to the combination are dealt with by the CCI in terms of the procedure provided under Combination Regulations and the outcome of the decision of the CCI is known only after 210 days, by calendar, having elapsed before the decision of the CCI becomes public, would the order of CCI be valid? What would be the fate of such an order passed by CCI either of approval or otherwise?
In my humble view, it would be extremely difficult to sustain such an order, received by the parties to combination, after 210 calendar days. Going by the trend that the court in the land have interpreted the implementing regulations to be of such a nature that they can mitigate the hardship but cannot be more burdensome, than the law, on the people to whom these were meant to serve.
It may be recalled that the Act is sought to be amended and the time limit of 210 days for deemed approval is sought to be brought down to 180 days as promised in the regulations. The amendment bill is lying before the Parliament. However, till it is done, the black letter law is that the time period of 210 days which certainly has the force of law and not necessarily 180 days. This means that chances of a party succeeding in getting a deemed clearance, if the order of CCI is passed after 180 days are quite high, compared to the chances of an order being upheld by the Competition Appellate Tribunal (COMPAT), if an order blocking any combination is passed by CCI after 210 days.
For a moment, let’s assume this to be a majority order and the show cause notice to be issued. As a consequence of this order, this would be issued on or after 12 November 2013. The replies of the parties to the combination would, in any case, only come by 12 December 2013. On that day, 15 more days beyond the statutory time limit of 210 days would have been passed. As an attorney for the parties to the combination, one can comfortably argue that the time limit for CCI to clear the combination was already over and, therefore, CCI was not having any jurisdiction over the filing of the combination as the combination, in question, already stood approved by virtue of the provisions of section 31(11) of the Act.
It is not really clear as the role the looming deadline of 210 days, barely 15 days away, had played in the majority decision of CCI clearing this deal and how much of it was shaped by the consideration of competitive concerns, or lack thereof. One thing is certain, if the first 30 days are not utilised in careful forming of the prima facie opinion of the CCI before giving public its due in the next 180 days (150 days, if the amendments are cleared by the Parliament), combinations would continue to be as smoothly sailing in India as they were before 1 June 2011—more by default.
(After completing more than two decades as a Commissioner in IRS of India, KK Sharma was appointed as the first Director General of the functional Competition Commission of India (CCI). He has also been a very active member of International Competition Network (ICN), Merger Working Group. Mr Sharma was also nominated to one of the handful positions of an individual member of the Research Project Partnership (RPP) Platform of UNCTAD. A Ph.D. fellow in competition law from Bangor University, UK, Mr Sharma did masters in engineering from IIT, Roorkee, before doing graduation in law. Later, he completed PG Diplomas in Economics for Competition Law from King’s College, London, and IPR Laws from NLSU, Bangalore, respectively after doing Masters in Economics.)