On the issue TRAI said
"In India, given that a majority of the population are yet to be connected to the internet, allowing service providers to define the nature of access would be equivalent of letting TSPs shape the users' internet experience. This can prove to be risky in the medium to long term as the knowledge and outlook of those users would be shaped only by the information made available through those select offerings."
The full explanation by TRAI is definitely worth reading, it talks about all the issues encompassing differential pricing, i.e., market distortion, information asymmetry, the natural of Internet and the special case of India. http://trai.gov.in/WriteReadData/WhatsNew/Documents/Regulati...