SECTORAL COMPETITION ACT

Sectoral Competition Analysis between Malaysia and India

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Sectoral Competition Analysis between Malaysia and India

Introduction

The paper aims to discuss and analyse the sectoral competition act adopted by Malaysia since for the year 2010, as well as a comparative analysis of Malaysian and Indian sectoral performances. Malaysia and India's economic and strategic relations with South-east Asia have deepened significantly since the implementation of its so-called 'Look East' policy. Although progress has been difficult and fallen short of expectations on both sides, ties could be bolstered with full enforcement of the Association of Southeast Asian Nations (ASEAN)-India free trade agreement (FTA), and closer cooperation on wider issues such as terrorism, food and energy security and climate change. However, much depends on the effective management of competition and complementarities.

Sectoral Competition adopted by Malaysia

The Malaysian telecommunications sector has been undergoing gradual liberalization since 1985, when Telekom Malaysia, the government-dominated enterprise, granted a number of licenses to private sector telecommunication operators. In 1999, the Malaysian Communications and Multimedia Commission was set up, and gradually the industry witnessed more competition in various segments of mobile, fixed line, and telephony services; in addition, the functioning of the sector became more transparent. The fixed line segment saw annual growth of 0.14% in 2009, while the mobile phone segment witnessed 10.4% growth during the same period. Broadband penetration also continues to grow, with statistics showing that it constituted around 55% of all Internet users in 2009. According to Datamonitor, around 69% of the population had access to the Internet in 2010, a figure that is expected to rise to 72% by 2015. Increasing the broadband penetration rate is one of the main objectives under the Malaysian government's Vision 2020 program.

Competition Act 2010 was passed by Parliament in May 2010 and gazette in June 2010. Drafting of this Act aims to promote economic development by improving and protecting the competitive process in the market. This Act under the jurisdiction of the Ministry of Domestic Trade, Cooperatives and Consumer Affairs and will take effect on January 1, 2012. This Act shall apply to all commercial activities within and outside the country that have an impact on competition in the Malaysian market. Act does not apply to any commercial activity that is regulated under the Communications and Multimedia Commission Act 1998 and the Energy Commission.

According to the Ninth Malaysia Plan to-10, competition is needed to create an economic climate that is more efficient and dynamic. Competition Act 2010 is to promote a healthy competitive environment and give foreign investors more confidence to invest in Malaysia. Traders who invest into the country without hindrance Malaysia will enable countries to enjoy economic growth. Users also have the goods with lower price with a lot of choices. This competitive environment aims to encourage the development of new products with high quality. Without competition, businesses will not be concerned with consumer welfare. For Malaysia, it affected the achievement of Vision 2020, a policy formulated to develop Malaysia into a knowledge- and innovation-based economy, and to be ...