NEW DELHI (SG) — As India aims to build a globally competitive digital economy, top international economists and legal experts warned that rushing into rigid, prescriptive digital market regulations could stifle domestic innovation, increase compliance costs for startups, and slow down the country’s booming AI ecosystem.
Speaking at The Dialogue’s 4th Annual International Conference in New Delhi on October 23, 2026, policy experts urged Indian lawmakers to maintain a flexible, evidence-based competition framework instead of replicating the European Union’s strict ex-ante models.
“Europe’s approach to digital markets has increasingly shifted towards a structural approach that prioritises the number of firms over how markets actually perform,” said Dr. Lazar Radic, Assistant Professor of Law at IE Law School. “A flexible, case-by-case competition framework is better equipped to account for technological changes while protecting consumers and enabling innovation.”
Shanker A. Singham, President of Competere Group, echoed these sentiments, noting that prescriptive regulation risks locking rapidly changing tech markets into their current state. He emphasized that for a developing economy like India, the absolute priority must be to accelerate economic activity and give businesses the freedom to scale.
The discussion heavily focused on India’s burgeoning artificial intelligence sector. Data from a recent empirical study by The Dialogue revealed that the domestic AI ecosystem thrives on flexibility:
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- Infrastructure Accessibility: 85% of Indian AI developers rely on public cloud infrastructure, with nearly 75% reporting sufficient choice among compute providers.
- Open Source Vitality: More than 96% of local AI developers rely on open-source tools, with 79% viewing open-source models as viable substitutes for proprietary alternatives.
- Growth Barriers: Instead of market dominance issues, developers identified data standardization (63.2%) and talent availability (47.2%) as the primary barriers to competitiveness.
Kazim Rizvi, Founding Director of The Dialogue, proposed that rather than introducing an entirely new regulatory regime, India should maximize its existing laws.
“Recent amendments to the Competition Act, including the Settlements and Commitments Framework, already provide an opportunity to address competition concerns through timely and flexible remedies,” Rizvi stated. He recommended strengthening the enforcement capacity of the Competition Commission of India (CCI) and its Digital Markets Division rather than imposing constraints that could hurt tech progress.
