China’s clampdown on tech cos is good news for India
New Delhi: China started its clampdown on consumer Internet companies last year with Jack Ma’s Alibaba Group, and followed it up this year with taxi aggregator Didi. It threatened big penalties on companies like Didi listed in USA, and reportedly studying cybersecurity breaches at the company.
Next, it smashed edtech companies, with reports surfacing of China wanting such tech companies to not make a profit. Then, it issued a statement wanting more oversight to secure interests of delivery partners, and that led to a 15% crash in the stock price of China’s leading foodtech company, Meituan. China has also said Tencent cannot enjoy exclusive rights to music.
So it’s clear that China is clamping down on Chinese consumer Internet companies. Why it might be doing ai debatable, but the fact it is doing so cannot be denied. (There is a school of thought that China sees consumer Internet cos as an American forte, and considers it to be “value negative” in taking away billions of dollars and talent away from R&D, industrial tech, and “hardcore tech”).
All of this can come as a big advantage for India. In these times of excessive liquidity, India can become an even bigger beneficiary of foreign capital. So far in 2021, India has minted 16 new unicorns, and raised a record $12 billion in the first six months of the year.
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