ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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India-China Relations-Long Way to Go

strong fillip to the pre-emption of capacity in various industries by large industrial units and units belonging to the large business houses and, thereby, to increase their control over the concerned industries and the industrial sector as a whole. It is such units which have the financial and other capabilities to instal capacity far in excess of the licensed limit at the time of project construction or later and then to 'persuade' the government to legalise such capacity. This certainty of the growth of the market power of the large units makes nonsense of the government's claim that regularisation of capacity makes for better utilisation of capacity and larger output. Any number of examples can be found of industries in which while a few big units have got their licensed capacities enhanced, overall capacity utilisation remains low. Preemption of capacity by large units is bound to discourage new units and fresh investment as well as pave the way for oligopolistic output restriction and price manipulation. In sum, what is sought to be passed off as an innocuous measure for putting to use 'capacity which already exists' will have a profound impact on the structure of industry by further enhancing industrial concentration and the dominance of large capital.

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