If one airline is responsible for nearly two thirds of India’s domestic flights and only two apps are in charge of over 80% UPI payments then market power ceases to be a debate about policy — it’s a monthly fee.
India’s economic growth has been more than just a simple increase. The economy has been quietly cranked down, with essential services concentrated in a few dominant players.
IndiGo’s operational failure in December 2025, the relentless hikes of telecom tariffs, and the growth of the payments duopoly all point to an even deeper change: the consolidation of prices is changing, increasing systemic risks, and eroding the promises of competition after liberalisation.
This report uses data from regulators, filings by companies and interviews with stakeholders to ask the unsettling question: who wins when the competition goes away, and who is the one who suffers?
The market concentration in India’s key sectors is dominated by single and dual players. Google controls 97% of the search sector, PhonePe/Google Pay 83% of UPI (Unified Payments Interface), IndiGo 65% domestic aviation.
India’s concentration problems: Market power in numbers
Consolidation across all sectors has reached a staggering scale.
IndiGo will control 65% of India’s domestic market by May 2025. Air India is second with 27,3%, and there are no carriers that exceed single-digit percentages.
As of October 2025 the five largest telecom operators will account for 98% users. Jio and Airtel control 70% of all wireless subscribers.
PhonePe, Google Pay and PayPal together control 83.3% UPI transactions.
Google controls 97.17% market share in India. Reliance Retail with its 19,340 outlets in 7,000 cities dominates organized retail. Zomato, Swiggy and Swiggy are the leaders of food delivery.
The consumer has felt the impact of this concentration directly.
Telecom ARPU (what subscribers pay each month) jumped by 16.89% from Rs149.25 in FY25 to Rs174.46. This was not due to innovation, but rather tariff increases by operators who were under minimal competition pressure.
ARPU is expected to reach Rs 200+ in FY26, a further 14.68% increase.
Jio’s and Airtel’s pricing is no longer regulated by competition. Instead, it becomes determined by market share and not demand and supply.
The operator’s tariff increases boosted the ARPU of telecom services in India by 16.89% during FY25.
The industry projections indicate that the market will continue to grow, reaching Rs 200+ by FY26. This is due to a consolidation of operators who have consolidated their pricing power.
Tariff increases in 2024-25 are a good example of this trend.
The Supreme Court rejected a price-regulation petition after the price increase in July 2024. It advised consumers to use public telcos such as BSNL, or to file complaints at the Competition Commission of India if there was suspicion of cartelisation.
BSNL has 36.92 millions broadband connections compared to Jio’s 486.58 million. This makes the so-called “competitive option” hollow for many users.
Since 2004, the regulator has operated under a policy of forbearance that allows telecom operators to freely set their tariffs, provided they submit them within 7 working days.
Increases are acceptable as long they don’t exceed formal thresholds for non-predation. This is true regardless of the existence or lack thereof of competition to limit them.
IndiGo: disruption, consumer fallout and dominance breaking.
IndiGo’s operational crisis in December 2025 crystallised extreme market concentration.
In November 2025, the airline was faced with an unprecedented wave of cancellations due to new DGCA crew duties norms. These included a tightening up pilot rest from 36 hours to 48 per week, and limiting night landings consecutively to only two.
IndiGo’s lean staffing model and high frequency of operations did not have a buffer to deal with regulatory changes.
The airline has cancelled 1,600 flights between December 2-11. This is a significant number of cancellations, which have left tens and thousands of passengers stranded. Compensation obligations of over Rs 500 crore were incurred.
ICD contacted India’s aviation regulator Directorate General of Civil Aviation Directorate General of Civil Aviation, but many officials are still hesitant to discuss how IngiGo got into such a mess.
Our oversight team flagged operational weakness to IndiGo repeatedly, but execution gaps in compliance with new crew duties norms and scheduling stabilisation exposed systemic weaknesses that we expected IndiGo have mitigated, said a senior DGCA representative familiar with the current review.
IndiGo’s operational failure has become a bottleneck for the entire economy.
Moody’s highlighted the airline’s lean operations, efficient during stable periods but vulnerable under pressure. This highlights governance risks inherent to dominance that lacks resilience.
The Government of India set up a 24-hour crisis hotline and competing airlines were limited in their spare capacity.
The DGCA imposed a mandatory 10% schedule reduction for IndiGo by December 11th, focusing on the routes that compete with other carriers.
This crisis revealed a harsh truth: When a single airline controls more than two thirds of the supply, it’s not just an airline issue; its failure becomes a crisis for the entire country.
M&A: a consolidation strategy for corporate perspective
Consolidation is strategic from the corner office.
India’s M&A scene has evolved into deliberate consolidation based on value, rather than deal-making based on opportunism.
Nearly 50% of India’s M&A activities are now mid-market M&A deals in the range Rs200-2,00 crore. Companies acquire rivals in order to gain industry leadership.
Reliance Industries is a good example of this.
Mukesh Amani’s conglomerate, Jio, captured more than 500 million subscribers in 2016 through its disruptive pricing. It also triggered an industry consolidation. At the same time, it built organised retail scale by acquiring Raskik V Retail and Eda-Mamma.
Reliance will spin off its consumer product business in August 2025 into a new subsidiary, focusing on India’s consumer market, which is “$2 trillion and growing fast”. This move itself was a consolidation strategy aimed at gaining share of the FMCG category.
Research on India’s consolidation trend notes that “Scale and regulation are driving firms to buy rather than build.”
Executives frame M&A as essential to survival.
Smaller, unorganised firms lose out as sectors mature, and regulations become more stringent, particularly after GST formalisation. Meanwhile, dominant companies acquire at a cost-efficient rate and can achieve razor-thin margins.
It creates an inescapable cycle. Consolidation reduces costs and allows for price increases when the competitive pressures fade.
This corporate logic hides an asymetry. Shareholders and deal-makers alike value the benefits of consolidation, which include lower costs and increased efficiency.
When competition is weak, these efficiency gains do not automatically trickle down to the consumer.
In order to achieve scale, the dominant companies weaponise their size: they dictate supplier terms, bundle services in order to lock-in customers, capture data, and create monetisation opportunities that are not available to rivals.
Scale and pricing power: From price to profit
Dominance compounds across verticals.
Bundling voice, data and broadband subscriptions with OTT services can create switching costs.
Jio’s bundle strategy initially offered free voice calls and lower data rates, but as the competition declined, Jio tightened its pricing.
PhonePe, Google Pay and other payment services use the UPI’s dominance in order to sell financial products and insurances, as well as credit lines. They do this by monetizing discovery and transaction flows.
Reliance Retail, with 19,340 outlets in 7,000 cities, can dictate terms to suppliers and monetise shelves via retail media networks. This creates new revenue streams that smaller chains cannot.
Algorithmic dominance is reflected in digital platforms.
Google has a 97.17% share of the search market, which means that advertisers and sellers will have to pay for visibility.
Meta and WhatsApp are under scrutiny by CCI for using platform data in an unfair manner to gain a competitive advantage across markets.
Rents are extracted through scale and the network effect.
Can regulators restrain the market?
The regulatory capacity for addressing consolidation is structurally limited.
The Competition Commission of India works within a framework of evidence designed to accommodate stable markets and not digital platforms that are constantly changing.
The CCI cleared 107 mergers, including many concentrated markets, in 2024. In that year, it only initiated 8 investigations, found 2 violations, and approved 107 new mergers.
CCI’s Digital Markets Division will be established by 2024 and promises to provide greater scrutiny for tech platforms. However, enforcement is slow.
The TRAI forbearance on tariffs delegates pricing to the operators.
DGCA’s reactive measures include: suspending crew norms and operational audits; schedule reductions. They stabilise IndiGo but do not address the structural risk that dominance is possible without resilience.
This is the result of reactive regulation, rather than structural interventions.
The use of show-cause, mandated refunds and circulars that provide advice can be substituted for proactive enforcement.
India’s MRTP framework (Monopolies and Restrictive Trade Practices), which had historically restricted monopoly practice, is now dormant. It has been replaced with a CCI directive that requires more evidence and operates on a slower timetable.
“Always damaging to consumers”: the case for revitalizing antimonopoly tools
The consumer advocacy groups have raised alarms.
Monopoly and duopoly are harmful for consumers. The Voluntary Organisation in Interest of Consumer Education argues that a truly free market consistently shows that competition results in outcomes which favour consumers in terms of pricing, choice and quality.
This is why the MRTP was introduced when India’s markets opened, bringing about “significant relief in all sectors” by curbing monopolistic behaviour.
The government has a fundamental responsibility to ensure a level playing ground. Consumers cannot accept that essential sectors like telecom, rails, and airlines dictate their terms. “The MRTP Framework must be revitalized and given an actively role to check monopoly powers in essential markets,” VOICE states.
The argument has gained traction with policymakers.
CCI’s outlook for 2025 anticipates “Competition Regime 2.1” with enhanced enforcement capabilities, simplified merger review timelines and increased deal value thresholds that capture digital transactions, previously out of regulatory scope.
In 2023 the Competition Amendment Act introduced “lesser penalties plus” to encourage cartel disclosure.
These reforms are still incremental. Without structural interventions, compulsory divestments, mandates for interoperability, or caps specific to each sector, the dominance of the market will only increase.
The consolidation of competition promises
India’s economy after liberalisation promised to discipline prices, improve service, and protect customers.
This promise is now inverted.
Consolidation has transformed essential services, from IndiGo’s operations to spiraling telecom rates to the payments duopoly. Market power is reflected directly in consumer bills.
This regulatory vacuum is characterized by forbearance, ineffective CCI enforcement and reactive measures. It allows dominance to grow unchecked.
Consolidation will continue until India’s framework for competition is revised with more structural tools, and enforcement of essential sectors are accelerated.
All of your IndiGo seats, mobile bills, and payment apps are sold by a single supplier. The suppliers know this. They’re charging accordingly.
The post Who is benefiting from Indian market concentration? From IndiGo Seats to your Phone Bill may change as new information becomes available.
