The government-appointed committee headed by M Govind Rao, director, National Institute of Public Finance and Policy, which was set up last year to review and suggest the best methods of declaration of retail sale price on pre-packed goods, seems to have been unable  to arrive at a unanimous suggestion in its report  submitted to the government last month.

The mandate of the committee was to give the consumer a reasonable idea on the cost of production so that manufacturers do not overprice their packaged products.

Its report said, "Given that there is scope for exploiting the consumers even when the maximum retail price (MRP) is declared, the question is whether the manufacturers should be required to declare any additional information that would educate consumers and empower them in regard to fairness of the price''.

The committee was, however, were split on what would be the best resource to educate the consumer on price disclosure by the manufacturer on packaged goods.

Since the cost of production of packaged goods ends when it leaves the factory, some members were of the opinion that the packaged goods should reflect the 'factory-gate price' as well as the 'maximum retail price', as strongly mooted by K K Jaswal , director of consumer rights organisation 'Common Cause'.

A K Sinha, member of the tariff commission of the commerce ministry went one step further and said in addition to the MRP, the package should also exhibit the cost of sales including taxes and profit margins of manufactures and resellers.

This idea was not taken well by the representatives of Indian companies in the committee.

Brittania Industries and Marico Industries who had represented before the the committee were not in favour of any regulation on retail prices and raised the issue of who could decide what was an inflated price, instead mooted that price determination should be left to market forces.  The companies instead wanted complaints on inflated price declaration to be investigated by the anti-trust authority.

Other members of the committee felt that in India with many differences in market structure, different state taxes and local factors that effect demand and supply would hamper the administering of the factory-gate price system.

The European Union and many other developed countries have the system of printing production cost and selling price on many of their packaged goods whereas in India only name and address of the manufacturer, the commodity's name, net quantity, date of manufacture and the MRP is essential on all pre-packaged goods.