Antitrust Law and Market Structure in a Liberalised Policy Regime: Emerging Issues in the Indian Context
Abstract
The role of antitrust law in prohibiting anticompetitive behaviour and promoting market competition has been well explored in the literature. Experiences of the leading economies in the world suggest that the antitrust laws in many countries have been successful in limiting monopolistic behaviour and fostering market competition. In India, the Competition Act (2002) broadly aims at prohibiting anticompetitive agreements and abuse of dominance along with regulating combinations. However, while the Competition Act (2002) replaced the Monopolies and Restrictive Trade Practices Act (1969), the subsequent changes in market dynamics, firms’ strategic behaviour and their implications for market competition and protection of consumers require deeper scrutiny. In particular, with the deepening of reforms in policies and regulations relating to trade, innovation and investment during the post-reform period, it is necessary to understand firms’ strategic responses to the Competition Act (2002) and their implications for market structure. In this context, this paper critically examines the theoretical underpinnings and empirical evidence relating to the implications of the Competition Act (2002) for the structure of different markets in the Indian manufacturing sector, given the complex trade–innovation–investment–competition interface.