Regulatory Delays Keenly Watched As India Negotiates FTAs: FM Sitharaman

Finance Minister Nirmala Sitharaman on Monday said delays in regulatory clearances carry global consequences, particularly as India negotiates Free Trade Agreements with several countries.

"In today's fast-paced economy, delays in regulating clearances can lead to uncertainty, disrupt commercial timelines and potentially erode the intended value of transactions and globally it has an impact, even as we negotiate free trade agreements with different countries, because the agility, nimbleness and the readiness of regulators is very keenly watched by investors...That has a very serious connotation when you're looking at agreeing on FTAs within reasonable timelines," she said at the Competition Commission of India's 16th Annual Day.

When regulators are less transparent, negotiations can get complicated, she said, emphasising the need for agile, anticipatory regulation that supports India's evolving economic ambition.

“The strength of any commission lies in its ability to anticipate what could happen,” Sitharaman said. While India's economic liberalisation has progressed steadily, she noted it “could have moved faster".

Sitharaman said the current global landscape, which is marked by intense digital competition and export volatility, demands a fine balance between regulatory oversight and market freedom. “In an export, environment, energy and emission-challenged world, the increased reliance on domestic growth levers requires the right balance of regulation and freedom,” she added.

The Finance Minister praised the CCI's efforts in building internal capacity, calling the newly created digital markets division “a timely move".

She also flagged emerging risks, including AI-related challenges like algorithmic bias and market concentration by gatekeeper platforms, noting that the rise of cross-border digital monopolies now demands global cooperation.

“Markets must work for the many, not the few. Competition ensures businesses are forced to listen. Mediocrity is punished by the market itself,” she said, highlighting CCI's role in fostering merit-based competition.

Citing this year's Budget, Sitharaman reiterated the government's principle of “minimum necessary, maximum feasible” regulations. She also pointed out the Budget's goals of rationalising merger requirements and widening the scope for fast-track mergers.

She concluded by stressing that the nimbleness of Indian regulators is being closely watched by investors globally, especially in the context of India's structural reforms and ongoing FTA talks.

"India's ongoing structural reforms—asset monetisation, disinvestment, and digital public infrastructure—are all geared towards unlocking market potential and deepening competition."