FinMin Urges Faster M&A Approvals for Low-Risk Deals; Will This Hurt Competition?

In a message that straddled both caution and capitalism, the Union Finance Minister Nirmala Sitharaman nudged the Competition Commission of India (CCI) to put those mergers and acquisitions that clearly do not hurt the competitive feathers of the market in the fast lane, as per media reports.

Speaking at the 16th Annual Day of CCI, Sitharaman called for regulators to walk the tightrope and find the right balance between “regulation and freedom.” Her mantra behind this is a pragmatic philosophy of “minimum necessary, maximum feasible”. She also emphasised “the ability of the CCI to strike a balance between regulatory vigilance and a pro-growth mindset will be integral to building a resilient, equitable, and innovation-driven economic framework.” 

But the minister’s remarks can also stir up a debate—Can any M&A ever truly be competition-neutral? Isn’t every merger just a step closer to lesser competition? And how does one ensure “the market works for the many, not the few”—another statement echoed by Sitharaman herself—while still giving green lights to select corporate consolidations?

Let’s take baby-steps and first understand how this corporate combination works and what are the regulatory frameworks and structures behind approving these in India.

What is M&A and What Impact Does It Have on Economy?

Mergers and acquisitions refer to the consolidation of ownership, assets, among other things, or a combination of two or more companies into a single entity. This is often done with the goal of creating a larger, more competitive company. Regulators and policymakers are vigilant to ensure that any such consolidation does not harm the competitive nature of the market as combinations might reduce the number of players in the market. This could give birth to higher prices for consumers, reduced choices, or less innovation.

However, these corporate actions are not always bad. In fact a rise in M&A trend signals confidence in any economy. M&As can help firms produce economies of scale and improve their efficiency by reducing costs, streamlining supply chains, and bringing in fresh investments. Beyond this, mergers can also save failing businesses and revive the “sick” unit.

Outlook for M&A Deals in India in 2025

According to Grant Thornton’s data cited in a report by Dezan Shira & Associates, India recorded 669 M&A transactions, amounting $29bn in the first three months of 2025, the highest quarterly volume since the same period in 2022. The transaction volume spiked 43% on year, while transaction value increased 17% on year.

Total M&A deal value for 2025 is expected to grow to $130bn-$160bn from $110bn recorded in 2024, the report said. 

Regulatory Eye on M&As

In India, M&A landscape is regulated by a network of authorities, each with its own mandate. The National Company Law Tribunal is the main gatekeeper for merger approvals, ensuring that the proposed deals meet legal standards. For listed companies, the Securities and Exchange Board of India steps in to safeguard shareholders’ interests.

Meanwhile, another watchdog CCI ensures that deals do not choke market competition. There are prescribed deal thresholds, beyond which any acquisition will come under the ambit of combination. CCI examines market dominance risks and works to prevent monopolies.

Fast-Tracking Mergers: Green Channel Route

The Competition Commission of India (Procedure in regard to the transaction of business relating to combinations) Regulations, 2011, was amended in 2019 and an automatic system of approval for combinations through a ‘Green Channel’ route was introduced.

The Green Channel is a fast-track approval system by the CCI for mergers, acquisitions, or amalgamations that are unlikely to harm market competition. Under this route, a deal is automatically approved upon filing, provided it meets strict eligibility criteria: the parties involved and their affiliates must not be in the same line of business, part of the same supply chain, or offer complementary products or services. Essentially, the companies must have no competitive, supplier-buyer, or interdependent relationship.

Experts’ Take on Swift Approval Remark

Swift approvals for certain M&As deals would be a positive move for the startups and the private equity/venture capital ecosystem as the rise in combinations and quicker deal closures would help inorganic growth in the companies as well as create a conducive environment of easier exits, Bhavesh Shah, head – Investment Banking at Equirus Capital said.

Commenting on whether or not all mergers result in market concentration, Sonam Chandwani, managing partner of KS Legal & Associates explained that not every corporate union is a villain in disguise; not all combinations hurt competition as mergers in fragmented markets or between complementary firms often enhance efficiency without stifling rivals.

If simple cases are cleared in 30-60 days, review time for CCI will drop to 150 days from 210 days and this will free resources for deals/cases that actually serious consideration such as that in big tech mergers, she added.

Bhavesh Shah echoed similar sentiments and added that this approach “will achieve dual results like the adage goes hitting two birds with one stone”.

This approach of creating a balance between regulation and growth could reshape investment landscape in India by attracting more foreign capital, Chandwani said. The watchdog must level up its tech and data analytics game to catch even subtle anti-competitive moves, she said.

While automation can streamline processes, relying too heavily on it without sharp human insight risks overlooking these nuances. “Over-reliance on automation without robust human oversight could miss nuanced market dynamics, potentially allowing creeping consolidation,” Chandwani said, arguing that CCI should also work on “post-deal audits to ensure this framework fuels growth without compromising fair competition” as the streamlining framework comes with oligopoly-risk attached with it “if post-merger monitoring falters”.

To wrap up—as regulators weigh in the scales of speed and scrutiny, the real challenge may not be how fast approvals are granted, but in how smartly they are analysed.