'Cronyism' is Modi govt's primary economic policy, says Congress

Accusing the Modi government of practising "cronyism", the Congress on Monday, 8 July, said companies must expand but at the same time, the government has a responsibility to ensure oligopolies or monopolies do not emerge and that undue advantage arising out of access to political power is not exercised.

Congress general secretary, in-charge communications, Jairam Ramesh alleged that market concentration continues to grow under Prime Minister Narendra Modi's watch, and has reached a new high in key industries such as telecom, airlines, cement, steel, and tyres.

He also shared on X a media report which claimed market concentration continued to increase in India's key industries as top players grabbed a larger share of the business in 2023-24 either through organic growth or acquisition.

In his post on X, Ramesh said, "Cronyism is the non-biological Prime Minister's primary economic policy. Market concentration continues to grow under Mr. Modi's watch, and has reached a new high in key industries such as telecom, airlines, cement, steel, and tyres."

"Revenue share of the top two firms has risen across industries in the last two years. Most industries in India are either moderately or highly concentrated," he said.

As former RBI deputy governor and noted financial economist Dr Viral Acharya established, five big conglomerates -- including the Adani Group -- are building monopolies in 40 such sectors, Ramesh said.

"This growing monopolisation is linked to India's shaky economic growth, unemployment crisis, and high inflation. In 2015, when a common man used to spend Rs 100 on goods, Rs 18 would go as profit to the business owner –– in 2021, the owner now gets Rs 36 in profits," he claimed.

"Firms must grow. Companies must expand. But at the same time, the Government has a responsibility to ensure competition is not stifled, oligopolies or monopolies do not emerge, takeovers are free and fair, and undue advantage arising out of access to political power is not exercised," Ramesh said.