Opportunities for India post Chinese App Ban

Contact Counsellor

Last Updated16/02/2022

The Union government on February 14, 2022 banned another set of Chinese apps (> 50) over concerns related to privacy and national security.
Now, the vaccum created by the ban of these apps should enable the Indian IT sector to create more hyper-regional and hyper-local applications and websites.

The Chinese government began erecting censorship barriers (aka "the Great Internet Wall of China") and banned several popular Western websites and applications years ago.
In January 2010, in response to a hacking attack from within China on it, Google announced that it would no longer censor searches in China and would leave the country completely.
Meanwhile, the Chinese Internet market exploded, and has grown to over 900 million users (paradoxically via Google’s Android) from just over 300 million in early 2010..

The Great Internet Wall insulated Chinese entrepreneurs from Big Tech in Silicon Valley.
Chinese web market was left with substantial appetites for Internet-based social, commerce, and lifestyle services which Big Tech could not fulfil.
Home-grown firms such as WeChat and Alibaba soon morphed into distinctly Chinese applications tailored solely to the home market.
Chinese version of popular apps:
Baidu has replaced Google in China.
Youku Tudou is YouTube
Xiaohongshu is a version of Instagram from which users can shop for goods directly.
WeChat began as a simple messaging app, but is now many things for the Chinese (social media, news, messaging, payments, and digital commerce).

In 2016, US President Barack Obama released a strategic plan which addressed many issues, but the most striking part of this report is that it appeared the Chinese had learnt their lesson from failing to make themselves an IT outsourcing services superpower like India had.
Now, U.S. is likely to follow India’s lead by banning Chinese apps and technology companies.
The widening reach of Internet connection in India will provide hundreds of millions of non-urban Indians with fluid access to the Internet.
India now has the lowest Internet data costs in the world.
The Chinese Internet industry to dominate the world, desperately needs India’s 500+ million netizens to continue to act as a training ground for the AI algorithms they put together.

Indian economy: The move to ban the apps could impact India in terms of investments and employment. Eg. ByteDance Ltd., the parent company of Tiktok had proposals of investments worth $1 billion in India. With the ban,it has potentially impacted job creation.
Chinese app providers: The potential loss of advertising revenue impacts app-makers.
Users: Installed apps may continue to exist on mobile devices. But now that the latest versions of the apps have been removed from Google’s Play Store and Apple’s App Store, users will not be able to access updated versions in future. If a notice goes out to internet service providers asking that data flow from these apps be halted, that could impact the functioning of existing, installed apps.
Growth of Indian IT Sector: Banning these Chinese websites and applications to the Indian public effectively allows our home-grown IT talent to focus on the newly arrived Internet user.

India’s focus remains on exporting IT services with little attention to servicing our own tech market.
India spent the last two decades exporting the bulk of our technology services to developed countries, the vacuum created as the Indian Internet grew is filled by US Big Tech and Chinese.
After the removal of more than 118 Chinese apps, Indian techies have started trying to fill the holes with copycat replacement websites and applications.
But faithful copies are not enough for us to make full use of China’s exit.

The primary Indian IT objective must shift from servicing others to providing for ourselves.
In the absence of Chinese tech, Indian entrepreneurs should not simply look to replace what the exiting firms have so far been providing but into providing services and products of high quality that will be used by everyday Indians across the country.
The aim of providing netizens with the same services across diverse markets is overarching — regional barriers created by language exist within our own nation.
These provide an accretion of excellent smaller markets, with opportunities for specialised Internet services created for a local community, by the community itself.
The fundamental focus of the new digital products that plan to emerge in the growing market should be to provide for hyper-regional necessities and preferences.

Accessibility is also crucial. However, national accessibility on its own will not make an app a game changer. Indians are savvy enough to know what a world class app is.
If we create hyper-local and hyper-regional services of high quality and great accessibility that are also portable across our linguistic diversity, we are far more likely to succeed in creating one of the strongest Internet markets in the world.
Global Technology companies have focused their efforts on the 15% of the world’s population with deep pockets while largely ignoring the other six billion denizens of the world’s population.

If we service our own tech market, India’s experiences as a modernising power are of great use to the bulk of the world’s population, which lives in penury when compared to its western counterparts. We can export our “India stack” to other countries in the “south”, like in Africa and Latin America. We have successfully done this before with our outstanding railway technology. There is no reason we cannot pull off the same achievement with our home-grown Internet power.