New Delhi, October 22, 2026: As India seeks to build a globally competitive digital economy, a central policy question is gaining importance: how can competition rules keep markets open and contestable without undermining innovation, investment and the growth of emerging businesses? This question was at the centre of The Dialogue’s 4th Annual International Conference, “Competition, Innovation, and Growth: Building India’s Digital Economy,” held in New Delhi on October 22.
The discussions centred on three interconnected challenges: enabling digital platforms to help micro, small and medium enterprises (MSMEs) scale their reach; creating the conditions for India’s AI ecosystem to compete and innovate globally; and shaping a competition policy that meets these dual challenges against a backdrop of shifting dynamics in global trade, investment and economic security. Across the discussions, a central question emerged: how can policymakers balance market fairness with the efficiencies digital platforms deliver — without undermining innovation, investment or economic growth?
Speaking on this, Dr. Lazar Radic, Assistant Professor of Law, IE Law School and Senior Scholar (Competition Policy), ICLE, said, “Europe’s approach to digital markets has increasingly shifted from a focus on efficiency and consumer welfare towards a structural approach that prioritises the number of firms over how markets actually perform. The challenge with prescriptive, ex-ante regulation is that it assumes regulators can predict how technology and markets will evolve. But in a sector as dynamic as technology, new products and business models can fundamentally change market boundaries in a matter of years. A flexible, case-by-case competition framework is better equipped to account for these changes while protecting consumers and enabling innovation.”
Shanker A. Singham, President and Chairman of the Board, Competere Group, highlighted, “There is a fundamental choice facing policymakers today: whether to pursue a competition framework that allows markets to evolve through competition on the merits, or one that attempts to prescribe market structures in advance. The evidence suggests that innovation and economic growth thrive when businesses have the freedom to compete, invest, and scale. Prescriptive regulation risks locking markets into their current state, increasing compliance costs for smaller companies and limiting the very opportunities it seeks to protect. For a developing economy, the priority should be to enable innovation, accelerate economic activity and ensure consumers and businesses can benefit from the latest technologies.”
Elisa Ramundo, Founder and Director, SCOPE Global Exchange, also added, “For developing economies, there is value in taking a measured approach to digital competition regulation rather than adopting prescriptive rules before fully understanding how these markets evolve. Governments need to recognise the limits of their ability to predict technological change and enforce complex regulatory frameworks. Much of the value of technology comes not simply from developing it, but from its adoption and widespread use. Duplicating existing technologies in the pursuit of strategic autonomy can increase costs for consumers and taxpayers. The better approach is to build on available technologies, leverage existing capabilities and create the conditions for innovation and investment.”
Kazim Rizvi, Founding Director, The Dialogue added, “Looking at the future of digital markets, India needs a digital competition framework that is evidence-based, forward-looking and supportive of innovation. These markets are evolving rapidly, particularly with the emergence of generative AI, which is already changing competitive boundaries across services such as search and digital intermediation. The experience of the EU’s Digital Markets Act (DMA) underscores the importance of regulatory flexibility. Recent amendments to the Competition Act, including the Settlements and Commitments Framework, already provide an opportunity to address competition concerns through more timely and flexible remedies while preserving case-specific economic assessment. Rather than moving to introduce a separate ex-ante regime, the priority should be to strengthen the CCI’s enforcement capacity, build specialised expertise within the Digital Markets Division (DMD) and improve the efficiency of the National Company Law Appellate Tribunal (‘NCLAT’). The objective should be to address competition concerns without constraining technological progress, raising barriers for startups or undermining the incentives to invest and innovate.”
The debate over AI competition is particularly relevant, and the challenge for policymakers is not simply to regulate market power, but to understand where genuine barriers to competition exist, where alternatives are emerging, and how policy can enable Indian businesses to innovate and scale.
The conference built on a growing body of policy debate around competition, innovation, and market structure in India’s rapidly evolving digital economy. Earlier in 2026, The Dialogue discussed its study, “Competition, Innovation, and Market Structure in India’s AI Ecosystem: An Empirical Assessment,” which examined competitive dynamics and adoption patterns across India’s AI value chain. The findings were striking:
- 85% of AI developers relied on public cloud infrastructure, while 5% reported sufficient choice among compute providers.
- Over 79% viewed open-source models as at least a partial substitute for proprietary alternatives, and 2% of AI developers rely on open-source tools, with 62.2% reporting high reliance.
- 2% identified data standardisation as their biggest data-related challenge; 47.2% cited talent availability as a major barrier to competitiveness.
- 2% of AI developers identify talent availability as a major barrier to competitiveness, underscoring the need to strengthen AI skills, workforce development and talent mobility to support the sector’s growth.
- 5% of surveyed companies (including startups and developers) operate across two or more layers of the AI stack. Integration across the AI stack was identified as a key reason for value derivation by downstream players.
- On the demand side, 85% of businesses reported a positive impact from AI adoption, with 61% citing better decision-making and 55% citing faster delivery. 79% of consumers said AI had reported that it improved their experience, and 74% agree that integrating AI into digital services has improved their overall user experience.
These findings offered a robust empirical foundation for the conference’s core debate: how competition policy can actively support — rather than constrain — innovation, investment, and the broader adoption of AI in India.