Sugar manufacturing associations and their members operating in the industry, which were accused of alleged cartelization and price manipulation by the Competition Commission of India (CCI), can now heave a sigh of relief as the competition regulator has given a clean chit to them. CCI, acting on Director General’s report which highlighted that some major sugar companies were rigging prices of the sweetener by forming cartels, came to the inference that there was no price cartel.
Indian Sugar Mills Association (ISMA), National Sugar Mills Co-operative Federation, and some private sugar firms like Shree Renuka Sugars, DCM Shriram Consolidated, Bajaj Hindustan and Mawana Sugar had received notices from the CCI earlier, whose suo-motu action charged them of cartelization and price manipulation. In order to prevent prices from falling below production cost, the competition regulator suspected that industry members had decided to increase the ex-factory price of sugar by 4-6%.
Arguing that the sweeteners’ prices were market driven and monitored by government regulations, the sugar associations and companies said that the sugar industry in Indian is highly fragmented with around 620 small-to-big production units in the nation, thus it becomes increasingly difficult for a few people to dictate prices.
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