What if AI determines quiet prices without anyone noticing?

New Delhi: India’s Antitrust watchdog intends to tighten its maintenance forces to address the threat to competition posed by the deployment of Artificial Intelligence (AI) in the industry, and has suggested that businesses comply with their AI System for Fair Trade. In a market study on ‘Artificial Intelligence and Competition’ released on Monday, the Competition Commission of India (CCI) said it would set up a thinking tank to consult on digital markets and AI issues, promote coordination with other regulators for effective supervision, work with global competitive guards and the technical capabilities and infrastructure. The watchdog also said that the government’s continued efforts and policy initiatives to facilitate AI infrastructure and AI capabilities will help remove access barriers to the sector and promote a level playing field in the development and use of AI in the country. CCI’s focus on AI for competition regulation is significant, given the rapid acceptance of the technology through businesses. The AI ​​market in India has risen from $ 3.20 billion in 2020 to $ 6 billion in 2024, and will continue to rise from $ 7.84 billion in 2025 to $ 31.94 billion in 2031, the CCI study states. According to this estimate, India is about 3.2% of the global AI market estimated at $ 244.2 billion. The concern of CCI is that although AI can promote efficiency and innovation, the concentration of players in the AI ​​value chain can create access barriers to new smaller players in this sector. The concern stems from the fact that the construction and training of AI systems needs deep bags, the power and access to datasy systems calculate. Another concern is’ ecosystem inclusion ‘, CCI pointed out, referring to AI instruments deployed by companies, making it difficult for users to switch to competitors’ services. The more one uses the AI ​​instrument of one business, it learns more about the user and performs it better, making it difficult for them to go to another company’s service, which needs to start from scratch. CCI also expressed concern about algorithmic collusion, citing how AI systems could automatically determine prices without human involvement and also participate in price discrimination, which can lead to higher prices for those willing to pay more compared to those who are price sensitive. The regulator also labeled opaque algorithms as concern. Based on the perception recording of AI startups, the possibility of AI-facilitated collusion, price discrimination and predator prices was expressed by 37%, 32% and 22% of respondents, respectively, CCI said. Predatory prices are undermining competitors until they are eliminated from the market and eventually raises prices to take advantage of the reduced competition. CCI said that self-audits of AI systems by businesses will help them to detect and correct potential competition problems. The regulator’s report also provided a guidance on how to achieve such self-audits. The recommendation on self-audits of AI systems is an interesting idea, and on the face of it one can think that it can encourage self-management and reduce the need for invasive enforcement, Bhoomika Agarwal, program manager, the dialogue, a technology policy tank said. “At the same time, its implementation will carefully reflect, as such mechanisms can be a challenge to monitor and probably need close coordination with other government agencies,” Agarwal said. “Since the AI ​​market in India is still rising, the more effective path, as also reflected in other recommendations of the study, in collaborative involvement, through workshops and continued research, lies to understand and address potential risks as the AI ​​market develops,” says Agarwal. A lack of transparency over the use of AI in decision -making could harm competition and consumers, CCI warned. “AI-powered price discrimination emerges as a strategic price tool, made possible by advanced analysis and machine learning. Although this approach can drive revenue optimization and improve the conversion rate, it brings in potential regulatory risks, including a lack of transparency and reduced consumer confidence, especially for vulnerable segments,” reads the CCI. “AI can also be used to implement predator strategies, by targeting only the price of the price for price -sensitive customers or those who run the risk of switching, while the prices keep unchanged for other customers,” it states. CCI said its efforts would be to develop a culture of compliance and fair competition in the AI ​​value chain, which preserves and promotes the incentives for innovation. The watchdog holds conferences and advocacy workshops on AI and compliance with the competition, it reads.