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Letters: Alternatives to cartelisation

Business Standard  |  New Delhi 

It is shameful that some of the most reputed business houses in the cement industry are involved in the unethical practice of making profits by deliberately underutilising their production capacity (“Competition watchdog bites Rs 6,300 crore off cement firms,” June 22). It is time the Indian cement industry resorted to ethical, though tougher, methods of increasing profits. The labour productivity in the industry is just about 1,400 tonnes per employee (based on CMA figures for 2010-11). Investment in training and development together with work simplification could help. Similarly, there is a wide scope for cost reduction, particularly in two areas — power consumption and transportation. The use of better quality inputs and modern technology (like vertical roller mills) will make the industry more energy efficient. Reduction of detention time of wagons and recourse to schemes like own-your-wagon or build-operate-lease-transfer will provide potential savings. The temptation to add to profits by ignoring ecological measures for air and water pollution should be checked.

Instead of appealing against the modest penalty imposed by the Competition Commission of India, the industry should seek professional alternatives to earn profits.

Y G Chouksey Pune

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First Published: Thu, June 28 2012. 00:20 IST