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AI in Markets: A Double-Edged Sword for Competition, Says CCI Chief

By  |  March 16, 2025

Artificial intelligence (AI) is reshaping modern markets, offering both significant opportunities and new challenges, according to Ravneet Kaur, Chairperson of the Competition Commission of India (CCI). Speaking at the 10th National Conference on Economics of Competition Law in New Delhi on Sunday, Kaur highlighted the transformative role of AI in various industries, particularly in areas like pricing, decision-making, and operational efficiency. However, she also warned about the potential for AI to foster anti-competitive practices, including algorithmic discrimination and collusion.

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    “AI is a driving force in modern markets,” Kaur noted, emphasizing that while the technology enhances market efficiency, it can also enable new forms of market manipulation. According to Business Standard, she explained that AI could facilitate collusion between companies without direct human interaction. This could take the form of “cartels without human communication” and “price coordination without explicit agreements.” Furthermore, Kaur pointed out that the technology could enable “algorithmic discrimination under the garb of dynamic pricing,” where prices are set based on customer profiling and data rather than competition.

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    Read more: Spain Takes Bold Step in AI Regulation with New Bill on Deepfake Labeling

    In light of these risks, the CCI Chairperson stressed the importance of adopting forward-looking, trust-based regulations to mitigate the dangers of AI-driven market distortions. As AI continues to play a more prominent role in shaping pricing strategies and business decisions, regulators must evolve their approach to competition enforcement. Traditional adversarial enforcement methods, Kaur argued, are no longer adequate to address the complexities of the modern market, which is increasingly influenced by AI, platform economies, and network effects.

    Per Business Standard, Kaur stated that the future of competition law should be characterized by a more collaborative regulatory strategy, one that acknowledges the role of data control, platform reach, and network effects in determining market power today. She underscored that regulators need to strike a balance between encouraging innovation and maintaining fair, open competition to prevent monopolistic practices.

    At the same conference, Union Minister of State for Corporate Affairs Harsh Malhotra echoed Kaur’s sentiments, calling for real-time monitoring of markets to ensure fair competition. As AI continues to redefine market dynamics, both Kaur and Malhotra emphasized the need for regulators to stay ahead of the curve to safeguard competitive market structures.

    Source: Business Standard