The Competition Commission of India (CCI) has dismissed a challenge by private bus operators to Kerala’s Priyadarshini Scheme, which provides free travel to women and transgender persons in buses operated by the Kerala State Road Transport Corporation (KSRTC).
The Commission held that a State-funded welfare scheme would not ordinarily attract competition law scrutiny merely because it causes a commercial disadvantage to private operators.
A Bench comprising CCI Chairperson Ravneet Kaur and Members Sweta Kakkad and Deepak Anurag passed the order on September 8.
“The formulation and implementation of a welfare scheme by the Government, aimed at public welfare, would not ordinarily invite scrutiny under the Act,” the CCI said.
The Commission added that any differential commercial impact on private operators resulting from such a policy measure could not, by itself, be treated as a contravention of the Competition Act.
The complaint was filed by two private stage carriage operators in Kerala alleging abuse of dominant position under Section 4 of the Competition Act by the State government and KSRTC.
One of them operates 18 buses on the Thrissur-Palakkad and Thrissur-Adat routes, while the other operates three buses on the Thrissur-Govindapuram and Thrissur-Kozhinjampara routes.
The Kerala government introduced the Priyadarshini Scheme in June 2026 under its Indira Guarantee programme. The first phase of the scheme provides free travel in KSRTC buses to all women and transgender persons.
According to the government order, the scheme is intended to facilitate mobility, increase employment opportunities for women and promote their socio-economic empowerment.
The private operators argued that the scheme has led to a substantial shift of women passengers from private buses to KSRTC services. This, they claimed, resulted in a significant fall in passenger volumes and revenue.
They alleged that the scheme was making private bus operations commercially unviable, forcing operators to reduce services or shut down. The arrangement, they contended, amounted to unfair discrimination, restriction of services and denial of market access under Section 4 of the Competition Act.
However, the CCI noted that the State bears the cost of free travel offered under the scheme.
“The fact that the scheme may influence passenger choice does not, by itself, establish that the OPs (private bus operators) have imposed an unfair or discriminatory condition upon private stage carriage operators or their passengers.”
The regulator also held that a change in passenger demand, even if it places private operators at a relative commercial disadvantage, cannot by itself be characterised as conduct intended to limit or restrict the provision of services.
On the allegation of denial of market access, the CCI said private bus operators have not been excluded from the market and continue to operate their permitted services and compete for passengers.
“The alleged loss of fare-paying passengers or reduction in revenues may, at best, indicate a commercial disadvantage arising from the implementation of a welfare Scheme,” the order said.
The Commission consequently found that no prima facie case of abuse of dominance under Section 4 had been made out and closed the complaint.
[Read Order]