By Raj Kishore Panda* in Bhubaneswar, December 22, 2025: During first week of this month the country witnessed a serious crisis in the Indian aviation sector. There was mass cancellation of flights by the IndiGo airlines stretching over more than a week. IndiGo being the dominant carrier in the domestic aviation sector with more than 64 percent market share, the abrupt flight cancellation led to a severe chaotic situation in several airports with thousands of the stranded passengers stuck hours together missing crucial events and incurring significant losses both financial and personal.

In the after math of the crisis there have been wide spread debates in different forums on the type of aviation market operating in the country and its extent of accountability towards passengers’ interest. Almost all those who vented opinion have expressed that the Indian domestic aviation market with the IndiGo having the dominant share has been developed into a monopoly business activity making air travel increasingly costly, reduced choices, decline in quality services etc over time. The present mass cancellations of flights by the IndiGo reveal the airline’s height of monopoly in dealing with the passengers’ interest and DGCA’s weakness in regulating the airline.

However, as available statistics reveal monopoly/duopoly market is not confined to the aviation sector alone in the country. We find working of one/two firms in several key business areas covering production, distribution including services sectors in the Indian economy. As it is noticed while in the aviation sector IndiGo along with Air-India control nearly 91 percent market share, in the telecommunication Reliance Jio and Bharti Airtel, in e-commerce Amazon and Flipkart, in food delivery Swiggy and Zomato, in organized retail Reliance Retail and DMart, in cement and steel J.S Steel, SAIL, Tata Steel do have predominant shares in their respective sectors. Monopoly also prevails in Public Sector with IRCTC, Coal India, Hindustan Aeronautics etc. More so, as we notice, over time these business houses are found increased in volume as well as spread leading to a threat to fairly competitive business environment in the country. As the Indian economy is increasingly digitalized with service-based network the fear of monopoly businesses are increasingly becoming stronger in the country.

In the context of rise in monopoly/ duopoly businesses in the country many studies reveal it as a post-liberalization phenomenon. In the beginning years of independence, no doubt we saw the rise in state monopolies. But such monopolies during that period were required from the point of view of developing various basic infrastructures in the country. However, in the late 1960s the Monopolies and Restrictive Trade Practices Act (1969) was enacted to curb concentration of economic power in the hands of a few. But in the post-liberalization period the MRTP Act was replaced / repealed by Competition Commission of India in 2002 aiming at fosteringa competitive environment in the economy.

However, as analysts opine the relationship between business elites and policy makers is found strengthened in the post-liberalization era leading to increasing concentration of economic power in the hands of a few large firms. The Competition Act 2002 focuses on prohibiting the abuse of a dominant entity and not dominance itself. What is worse, we also see mergers and acquisitions in recent years which have further increased market concentration. The corporate conglomerates are coming up in the country. In the financial market the government has been pursuing the policy of consolidation in recent years.

Between 2017 and 2020 twenty one public sector banks have been amalgamated to twelve and there is also current thinking to further consolidate these twelve banks to four. There is fear that fewer and larger banks may lead to oligopolistic market structure mispricing capital and neglecting rural and priority sector needs.

It is to be affirmed that the rise of monopolies fundamentally conflicts with the achievement of inclusive and sustained growth as it primarily enhances inequality. The concentration of market power transfers wealth from consumers and workers to a small group of owners. The monopolists as price makers usually fix prices of commodities significantly higher than in a competitive market which eventually reduces purchasing power of the low-income households influencing their consumption and demand.

Since the Indian economy is largely a consumption demand driven economy, to achieve higher production and growth, the rise of monopolies / duopolies will have negative impact on achieving inclusive and sustained growth. Rise of monopolies poses a challenge to achieving Viksit Bharat by 2047.\

• Formerly, Professor of Economics, Utkal University and Director NKC Centre for Development Studies, Bhubaneswar