Economic Challenger - - CONTENTS - - Dr. Smt. Nivedita A. Lal


Choice is some­thing one gets used to, which is why it is a sen­si­tive is­sue. Choice with out in­for­ma­tion is not a real choice. But the cru­cial ques­tions are what sort of in­for­ma­tion is ap­pro­pri­ate, how much and given by whom.

Right to choice lies at the cen­tre of the idea of con­sumerism. Choice is in­ex­tri­ca­ble linked up with moral­ity no­tions of right and wrong, good and evil. Choice is some­thing one gets used to, which is why it is a sen­si­tive is­sue. As in­di­vid­u­als ev­ery­one likes to be­lieve that they have choices, even if they may not be ex­er­cis­ing those choices The last thing peo­ple will sur­ren­der, when ev­ery­thing else is lost, is the right to make choice. The con­cept of choice will be­come mean­ing­ful only when it is ac­com­pa­nied by in­for­ma­tion. It should be noted that choice with­out in­for­ma­tion is not a real choice.


Right to choice can be re­garded as an as­sur­ance, wher­ever pos­si­ble, of avail­abil­ity, abil­ity and ac­cess to a va­ri­ety of goods and ser­vices at com­pet­i­tive prices, and to con­sume them in a sus­tain­able man­ner. Apart from this, the right to choice is also im­por­tant with re­spect to the pro­vi­sion of com­modi­ties and ser­vices where com­pe­ti­tion is not pos­si­ble and government reg­u­la­tion is supreme. In this case, the right to choice means as­sur­ance of sat­is­fac­tory qual­ity at fair price. In strict eco­nomic terms , their right to choice is jus­ti­fied by the eq­uity prin­ci­ple. How­ever, this right is also re­lated to the ef­fi­ciency prin­ci­ple un­less there are ef­fi­cient pro­duc­tion and distri­bu­tion sys­tems con­sumers will have lit­tle or no ac­cess to choose be­tween al­ter­na­tives.


Glob­al­iza­tion and lib­er­al­iza­tion poli­cies in the last eigh­teen years have changed the con­tours of con­sumer de­mand for goods and ser­vices The con­sumer now ex­pects the domestic pro­duc­ers to sup­ply him/her qual­ity goods and ser­vices at 'glob­ally com­pet­i­tive prices' The trade lib­er­al­iza­tion in the area of con­sumer goods has al­lowed the con­sumer to ex­ert his / her power of right choice. It is be­ing ex­pe­ri­enced in re­cent years that con­sumer goods im­ports are flood­ing the In­dian mar­ket and the In­dian man­u­fac­tures pro­duc­ing sim­i­lar goods have ei­ther had to close down or have had to sell their sheds or had to sell their own­er­ship rights. This kind of sit­u­a­tion could give rise to a pos­si­ble oligopolis­tic mar­ket in the fu­ture wherein the con­sumer might be stripped off his right to choose or would have the op­por­tu­nity to hon­our his right but un­der the dic­tated price struc­tures of the pro­duc­ers


One may be tempted to say that the right to choice is the ba­sis of lais­sez-faire (free mar­ket) eco­nom­ics. The an­swer to this query can be both neg­a­tive as well as af­fir­ma­tive. This am­bi­gu­ity is due to the er­ro­neous in­ter­pre­ta­tion of the fun­da­men­tal the­o­rem of wel­fare eco­nom­ics. The cor­rect in­ter­pre­ta­tion of the fun­da­men­tal the­o­rem lies in its as­sump­tions. The fun­da­men­tal as­sump­tion is that in­di­vid­u­als are to act within cer­tain so­ci­etal norms and reg­u­la­tions. Con­sumer's Wel­fare needs to be max­i­mized within the bound­aries of such norms and reg­u­la­tions. In the con­text of the right to choice, such norms and reg­u­la­tions are pro­vided in the UN Guide­lines.


The Guide­lines, un­der the sec­tion on pro­tec­tion of con­sumers' eco­nomic in­ter­ests, have stated the ob­jec­tives be­hind the right to choice. It has sated that the Government poli­cies should en­able the con­sumers to ob­tain op­ti­mum ben­e­fit from their eco­nomic re­sources as well as in­ten­sify their ef­forts to pre­vent prac­tices which are dam­ag­ing to the eco­nomic

in­ter­ests of con­sumers by en­sur­ing the man­u­fac­tur­ers, dis­trib­u­tors and oth­ers in­volved in the pro­vi­sion of goods and ser­vices ad­here to es­tab­lished laws and manda­tory stan­dards. Sim­i­larly it has stated that the government should de­velop strengthen and main­tain the mea­sures re­lat­ing to the con­trol of re­stric­tive and other abu­sive busi­ness prac­tices, which may be harm­ful to con­sumers, in­clud­ing means for the en­force­ment of such mea­sures. The guide­lines also pin point the need for en­cour­ag­ing fair and ef­fec­tive com­pe­ti­tion in or­der to pro­vide con­sumers with the great­est range of choice among prod­ucts and ser­vices at low­est costs. It sug­gests that the pro­mo­tional mar­ket­ing and sales prac­tices should be guided by the prin­ci­ple of fair treat­ment of con­sumers and should meet le­gal re­quire­ments and en­cour­age the free flow of ac­cu­rate in­for­ma­tion on all as­pects of con­sumer prod­ucts.


In In­dia the Government's pol­icy with re­spect to the right to choice can be di­vided into two broad parts. Firstly, the Con­sti­tu­tion's var­i­ous pro­vi­sions di­rectly and in­di­rectly re­late to the ob­jec­tive of the right to choice. Se­condly, var­i­ous Acts (and re­lated ad­min­is­tra­tive mea­sures), are en­acted by both the Cen­tral and the State Gov­ern­ments. The right to choice in­her­ently re­lates to se­cure and pro­tect the wel­fare of the peo­ple, as very of­ten devel­op­ment is also re­ferred to as en­larg­ing peo­ple's choice. In other words, this right is one of the ba­sic pil­lars of a demo­cratic State.


The pre­am­ble to the In­dian Con­sti­tu­tion adopts, en­acts and prom­ises to se­cure for all its ci­ti­zens so­cial, eco­nomic and po­lit­i­cal jus­tice and also lib­erty of thought and ex­pres­sion. The right to choice can­not be main­tained un­less there are jus­tice and lib­erty, i.e. the ad­her­ence to norms and reg­u­la­tions. Un­der the chap­ter on Di­rec­tive Prin­ci­ples of State Pol­icy (Chap­ter VI), Ar­ti­cle 38(1), it is the duty of the State to pro­mote the wel­fare of the peo­ple by Se­cur­ing and pro­tect­ing as ef­fec­tively as it can, a so­cial or­der in which jus­tice shall gov­ern all the in­sti­tu­tions of na­tional life.


Apart from th­ese leg­isla­tive (though not jus­ti­fi­able in a Court of Law) pro­vi­sions, cer­tain Acts have been passed by the Union Government to se­cure, pro­tect and en­able con­sumers to ex­er­cise their right to choice. Such Act/Laws can be broadly di­vided into three sec­tions those reg­u­lat­ing busi­ness, those re­lat­ing to com­pen­sa­tion/re­dress, and the gen­eral laws. The Es­sen­tial com­modi­ties Act ( ECA), 1955 pro­vides to dis­ad­van­taged con­sumers ac­cess to es­sen­tial com­modi­ties, and also plays the role of 'checks and bal­ances' on mar­ket­ing of es­sen­tial com­modi­ties. The Stan­dards of Weights and Mea­sures Act, 1976 en­sures that cer­tain com­modi­ties can be sold only in cer­tain mea­sures or weights. This Act also ap­pends rules re­gard­ing the sale of pack­aged com­modi­ties.


The afore­said anal­y­sis makes it clear that in In­dia the government seems to be sin­cere in en­sur­ing the con­sumers' right to choice. But the proper im­ple­men­ta­tion of the reg­u­la­tions re­mains a se­ri­ous is­sue. The new eco­nomic pol­icy has opened a flood­gate of con­sumer prod­ucts in the mar­ket with­out an ef­fec­tive reg­u­la­tory mech­a­nism. In such a sit­u­a­tion, con­sumers are sad­dled with the prob­lem of choos­ing be­tween too many prod­ucts with too less in­for­ma­tion. This is the sit­u­a­tion where con­sumers need ef­fec­tive reg­u­la­tory in­sti­tu­tions for sup­ply­ing of re­li­able in­for­ma­tion, which re­mains a far cry. The role of the bu­reau­cracy in en­forc­ing con­sumers' right to choice is of­ten miss-con­strued.


It should be noted that even though very ef­fec­tive leg­isla­tive pro­vi­sions are there in In­dia with re­spect to con­sumer's right to choice they are not prop­erly im­ple­mented. The in­ad­e­quate im­ple­men­ta­tion of th­ese laws is due to sev­eral fac­tors. The ma­jor fac­tor is that of lim­ited in­for­ma­tion about the prod­ucts. The sit­u­a­tion is fur­ther ag­gra­vated by the ab­sence of ef­fec­tive reg­u­la­tory mech­a­nism, both in prod­uct as well as in util­ity sec­tors. Of­ten peo­ple have pre­con­ceived no­tions re­gard­ing the out­come of any de­ci­sion process. The In­dian in­dus­try is mostly en­gaged in price com­pe­ti­tion and not on qual­ity com­pe­ti­tion. The lack of knowl­edge on the part of con­sumers has also contributed to­wards the in­ef­fec­tive im­ple­men­ta­tion of leg­isla­tive pro­vi­sions.


From the above anal­y­sis, it has been ob­served that though in cer­tain pa­ram­e­ters we have been able to im­prove the sit­u­a­tion, the at­tain­ment of "choice based on in­for­ma­tion" re­mains only a slo­gan and still seems to be a dis­tant dream. In or­der to im­prove the sit­u­a­tion, it is nec­es­sary to adopt a com­pre­hen­sive and need based choice pol­icy at the na­tional (Macro) level. The ob­jec­tive should be clearly men­tioned in the pol­icy which should be aimed at the re­moval of con­straints and en­sur­ing fair play in busi­ness. Sim­i­larly cor­rect in­for­ma­tion about the prod­ucts should be pro­vided by en­sur­ing the re­moval of mis­lead­ing ad­ver­tise­ments. To im­prove the sit­u­a­tion fur­ther, The government should take all the mea­sures to make avail­able un­lim­ited goods through an ef­fec­tive reg­u­la­tory mech­a­nism to pro­tect, en­force and ex­e­cute the poli­cies in such a way that con­sumer wel­fare is max­i­mized.


There is no doubt that the con­sumer's right to choice is a fun­da­men­tal right for ci­ti­zens to live with dig­nity in civil so­ci­ety. In In­dia, though this right has not been en­shrined in the chap­ters on fun­da­men­tal rights, it has been spelt out quite clearly in the chap­ters on Di­rec­tive Prin­ci­ples of State Pol­icy. The prob­lem is not that of lack of ef­fec­tive leg­isla­tive pro­vi­sions in In­dia for en­sur­ing the con­sumers' right to choice, but their fail­ure to im­ple­ment. Un­less the pub­lic ma­chin­ery is geared prop­erly to com­bat this men­ace the con­sumers will be left at the mercy of busi­ness.


1. Con­sti­tu­tion of In­dia. 2. Me­hta, Pradeep S (1992), From Caveat Emp­tor to Caveat Ven­dor, in Con­sumers in the Global Age. 3. Pro­ceed­ings of In­ter­na­tional Con­fer­ence on Con­sumer Pro­tec­tion, New Delhi, In­dia, 2224 Jan­uary. 4. Yian­nis and Tim­lang ( 1995), The Un­man­age­able Con­sumer: Con­tem­po­rary con­sump­tion and its Frag­men­ta­tion, Sage Publi­ca­tion, Lon­don. 5. Chakravarty, Sukhamoy ( 1986), Devel­op­ment Plan­ning: The In­dian Ex­pe­ri­ence, Ox­ford Univer­sity Press.

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