India’s move from the Monopolies and Restrictive Trade Practices Act, 1969 to the Competition Act, 2002 shows a big change—from controlling monopolies to encouraging fair and open markets.
This paper explains that India’s competition law is pluralist by nature. It supports the idea of fair markets and inclusive growth for all sections of society.
While the consumer welfare standard (focused mainly on low prices and good quality) is simple and matches global practice, the pluralist approach fits better with India’s Constitution and its goals of balanced and fair development.
- Introduction:
India’s business laws have changed greatly over time. The old law, Monopolies and Restrictive Trade Practices Act, 1969 (MRTP Act), was mainly about stopping monopolies. The new Competition Act, 2002 (CA 2002) focuses on encouraging fair competition, protecting consumers, and allowing everyone the freedom to do business.
This change brings up an important question: Should India’s competition law follow the global model that focuses only on consumer welfare (like low prices and good quality)? Or should it continue with its pluralist approach, which includes many goals such as fairness, equality, and growth?
This article argues that India’s law, its enforcement by the Competition Commission of India (CCI), and court decisions all support a pluralist approach. This pluralism fits with India’s Constitution and is better suited to the country’s economic and social realities as a developing nation.
- Statutory Framework – A Pluralist Mandate:
The pluralist nature of Indian competition law is clearly shown in the text of the Competition Act, 2002.
According to Section 18, the Competition Commission of India (CCI) must:
- Stop unfair practices that harm competition,
- Promote and maintain healthy competition,
- Protect consumer interests, and
- Ensure freedom of trade for all market players.
These four goals are equally important—none is above the other.
The Preamble of the Act also repeats these aims, showing that India’s competition law is designed to support fair competition, consumer protection, and free trade together.
This approach is different from the United States, where competition law mainly focuses on consumer welfare—usually meaning low prices and good quality.
In India, however, the law follows a pluralist approach: it values not just price and efficiency, but also fairness, innovation, and inclusion as key parts of a healthy economy.
III. Practice of the Competition Commission of India (CCI):
The CCI’s work clearly reflects a pluralist approach—it looks at competition issues from many angles, not just the effect on prices.
In Automobile Dealers Association v. Hyundai Motor India Ltd., the CCI studied restrictive dealership agreements not only to see if they harmed consumers, but also to check how they affected the freedom of dealers and blocked new businesses from entering the market.
In Matrimony.com v. Google LLC, the CCI looked at Google’s dominance in online advertising and considered how it affected innovation, competitors, and market openness—not just consumer harm.
Similarly, in the Schneider Electric–Larsen & Toubro merger case, the CCI assessed the impact on technology, competition between firms, and new business entry, showing its focus on multiple factors rather than only price.
Beyond enforcement, the CCI also promotes inclusive growth through awareness programs, compliance training, market studies, and outreach to small and medium enterprises.
The judiciary has supported this approach. In Excel Crop Care Ltd. v. CCI, the Supreme Court stated that the law’s goals go beyond price and include freedom of trade and market integrity. The Court said that analysis under Section 19(3) must consider both positive (like efficiency and innovation) and negative (like barriers and market foreclosure) effects—confirming that the Act is pluralist in nature.
In Union of India v. V. M. Ganesan, the Court further explained that the CCI’s powers cover many market issues beyond just consumer pricing, strengthening the pluralist vision of India’s competition law.
- Arguments for a Singular Consumer Welfare Standard:
Proponents of a monist, consumer welfare-based approach advance three principal justifications:
- Regulatory Clarity and Predictability: A single, quantifiable benchmark minimizes interpretive ambiguity and discretionary enforcement.
- Global Harmonization: Aligning with dominant jurisdictions such as the US and EU would facilitate cross-border cooperation and policy coherence.
- Economic Efficiency: A focus on price, quality, and consumer choice provides measurable indicators for empirical, data-driven regulation.
From this perspective, pluralism appears diffuse and administratively unwieldy, potentially allowing policy overreach under the guise of protecting broader interests.
- Critiques of the Singular Standard:
However, making consumer welfare the only goal of competition law would ignore India’s social, economic, and constitutional realities.
- Impact on Small Businesses: If the law focuses only on prices, it could harm micro, small, and medium enterprises (MSMEs), which play a vital role in India’s economy.
- Neglect of Innovation and Market Structure: A single-goal approach might overlook problems like the suppression of innovation, control of data by big companies, or barriers that prevent new businesses from entering the market.
- Conflict with the Constitution: India’s Directive Principles of State Policy and Preamble stress justice, fairness, and equality. A one-dimensional focus on consumer welfare could weaken these constitutional values by putting efficiency above fairness.
Therefore, pluralism in competition law is not just required by statute but also supported by the Constitution, as it ensures that enforcement serves the broader public interest and promotes inclusive growth.
- The Case for Pluralism:
Pluralism in competition law allows the Competition Commission of India (CCI) to set its priorities based on the specific needs of different sectors and stages of development. It gives the Commission the power to help small businesses enter markets, reduce regional inequalities, and regulate large digital platforms where the main problems are not just about prices, but also about data control and unfair algorithms.
This approach also fits well with India’s social and economic diversity, recognizing that markets are not only for buying and selling but also for creating equal opportunities and inclusion.
However, pluralism is not without challenges. Having many goals can sometimes lead to confusion or inconsistent decisions. To avoid this, the CCI needs to ensure clear reasoning, well-defined policy priorities, and a balanced approach when handling conflicting objectives.
VII. Conclusion:
The Competition Act, 2002 clearly follows a pluralist approach, both in its words and in how it is applied. While focusing only on consumer welfare might make the law simpler and more in line with global practice, such a narrow view does not suit India’s unique economic conditions or the growing challenges of the digital economy.
A pluralist framework, though more complex, allows the Competition Commission of India (CCI) to balance efficiency with fairness, support innovation while ensuring inclusion, and promote economic growth in line with constitutional values.
The future of India’s competition law, therefore, should not be about reducing its goals to one single focus, but about strengthening its pluralist vision through clear and fair decision-making.
India’s approach to competition law is unique—not a copy of Western systems—but a reflection of India’s own idea of economic democracy, built on the principles of justice and fairness.
