Friction #1: Perfect competition is a chimera. Let’s settle for imperfect.

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Editor's note: Welcome to the first issue of Friction, a fortnightly newsletter on corporate governance in India by Sundeep Khanna, only for subscribers of The Morning Context. Sundeep, formerly executive editor at Mint, has in a career spanning three decades been one of the foremost chroniclers of business in the country. Earlier this month, the Competition Commission of India, concluded its investigation against FAG Bearings India Ltd (now, Schaeffler India Ltd), ABC Bearings Ltd (now amalgamated with Timken India Ltd), National Engineering Industries Ltd, SKF India Ltd and Tata Steel Ltd, Bearing Division on charges of them being involved in cartelization in the domestic industrial and automotive bearings market between 2009 and 2014.  In its judgement, the CCI was clear enough, once you got past the legalese: “contravention of the provisions of Section 3 (3) (a) read with Section 3 (1) of the Act by these 4 parties viz. NEI, Schaeffler, SKF and Tata Bearing, as a result of their cartel arrangement reached through the meetings held on 03.11.2009 and 31.01.2011, stands established.” The country’s competition watchdog had clearly found the companies …