Why ‘Boycott Chinese Apps’ Can’t Ignore China’s $8 Bn in Desi Apps

Chinese investors like Tencent, Alibaba and ByteDance have invested in companies like PayTm, Swiggy, Ola and Byju’s.

Updated30 Jun 2020, 03:37 AM IST
Tech and Auto
3 min read

Video Editors: Sushovan Sircar and Ashutosh Bharadwaj

As the tense Indo-China military standoff along the Line of Actual Control (LAC) in the Ladakh region continues to simmer amidst defence and diplomatic negotiations, the ‘Boycott Chinese Apps’ trend has continued to rage as a form of protest.

The big question, however, has been about whether it can have any meaningful impact on Chinese apps and technology that flood India’s markets.

While the boycott has specifically targeted Chinese-owned apps like TikTok, Nikhil Pahwa, a digital rights activist and founder of MediaNama, explains the nuances in the complex India-China relationship with regards to technology and cyberspace.

Not a New Phenomenon

Pahwa points out that opposition to foreign technology giants has been an ongoing phenomenon. While the pushback in recent times has been against e-commerce companies like Amazon, the boycott of Chinese apps is another example of promoting homegrown products over foreign ones.

“Whether it is the Swadeshi Jagran Manch and the CAIT holding dharnas when Jeff Bezos was visiting India or whether it is Indian founders like Vijay Shekhar Sharma talking against digital colonisation,” Pahwa said regarding the recent spate of opposition to foreign influence in India’s technological sector.

“Mukesh Ambani did that too (with data localisation). Nandan Nilekani during the net neutrality debate also made that argument against Facebook,” he added.

“So, you’re seeing that pushback and it’s ironic in particular that PayTm has made this argument given a majority of one97, which is PayTm’s parent company is owned by a Chinese company.”
Nikhil Pahwa, Founder, MediaNama

Would Chinese Companies Be Worried?

“If you think about it, you can see this as a protest against Chinese companies and against China's incursion into our territory. I do think this is a legitimate form of protest,” Pahwa said.

“Although it is a bit naive to expect it will have any impact from a geopolitical perspective because companies and countries don’t play the short-term,” the MediaNama founder added.

Pahwa said apps like “Remove Chinese Apps,” which help identify and uninstall Chinese apps, will just be in the headlines for a short while and “none of us will remember this one year from now.”

“So, countries have a longer vision. Companies also have a longer vision. I don't think the Chinese companies will be too worried about it. I don't think the Chinese government will be worried about it.”

Chinese Funding Behind India’s Big Start-ups

“There is a digital belt and road initiative in that sense that Chinese apps have made an international foray very aggressively over the last few years,” said Pahwa, explaining how India has been one of the largest recipients of Chinese investments over the last few years.

China’s investments into India’s tech start-up space have been over $8 billion over the last five years.

In an indictment of the government’s struggle to boost domestic investments into start-ups, Pahwa said, “I think our government fails us when it pays only lip service to the start-up ecosystem. If you look at the growth we've had in start-up ecosystem a majority of it has come on from foreign funding historically.”

“Whether it was Tiger Global initially, then it was Tencent, Softbank, Alibaba. These are the companies that have really built India’s start-up ecosystem,” said Pahwa.

While ‘start up India’ is a great slogan, it really hasn't given any fillip to the start-up space.

STRUGGLE TO RAISE FUNDS IN INDIA

“You look at the angel tax that was put on investment in India's start-ups. That has now been removed but just the process of doing business in India is so difficult. Raising money from Indian businesses is so difficult that you're going to find it difficult to compete at not only at an India state but also a global stage,” he added.

Among Indian apps that have truly gone global, only Zomato stands out. “We are mostly a services economy, we are mostly a back office,” Pahwa pointed out.

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Published: 12 Jun 2020, 04:09 AM IST

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