Competition Commission of India launches market study on cement sector

The Competition Commission of India (CCI) has launched a pan-India market study on the cement sector, which is susceptible to collusion due to its structural features, the antitrust watchdog said.

Given the criticality of cement for many vital sectors, the CCI will conduct a fact-finding exercise to develop a comprehensive understanding of the functioning of the cement market across regions in India, and its state of competition.

CCI said that some of the objectives of the study are to study the market trends including movements in cement price, cost, production, capacity, capacity utilisation and profitability. The study will also examine the evolving market structure of the sector, pricing in trade and non-trade segments among other issues.

“Cement is a critical input in crucial sectors of the economy such as housing and infrastructure. These sectors have well-known forward and backward linkages with a range of other industries, thereby having the potential to influence the overall growth trajectory of the economy,” the CCI said.

The study will be a combination of secondary research and stakeholder consultation.

The cement companies have often been accused of cartelisation.

In 2016, CCI had found ten cement companies and the Cement Manufacturers Association in contravention of the provisions of the Competition Act, 2002 that prohibit anti-competitive agreements including cartels.