After the Indo-China border clash on the Line of Actual Control on June 15, anti-Chinese sentiment grew in India. Later the Indian government banned 59 Chinese apps in India 2020 citing a threat to the country’s “sovereignty and security”. The ban addresses data security concerns in the country, but it exposed a lack of app eco-systems in India.
Mobile phone apps have become a new norm in India. In the number of app downloads, we beat the United States standing next to China who is at the top. According to App Annie, an app analytics company, app download growth in India is 215 percent over the last two years.
The report also says India topped the list of the monthly average of apps used and installed. On a monthly average Indian used 40 mobile apps while having a base of 80 mobile apps on his phone. In this parameter, India stands first beating China and Brazil.
Most of these apps lack one thing that is the number of apps built in the country. India has a long way to go for building a robust app eco-system in the country. An eco-system can serve as a launchpad for Indian apps in the global market.
After the 59 Chinese apps banned in India 2020, the Indian government announced the launch of the ‘Digital India Atmanirbhar Bharat Innovate Challenge’ to promote local app innovators. However, such contests stand nowhere in front of the Chinese influence on the India app market and don’t serve as a real initiative to push Indian startups to come up with innovations.
China invested largely into Indian start-ups in 2019 with more than $5.8 billion in the last seven years. Indian unicorns such as Ola and Byjus have one Chinese investor at least. Such hold in the strategic sector is likely to give China a stronghold on India’s digital economy.
The government banned 59 Chinese apps In India 2020 but still lacks the policy to support and develop domestic app-based companies. The center must develop a policy and support domestically developed apps in sectors like gaming, e-commerce, media, etc.
The number of active mobile internet users in India is around 503 million and is expected to rise by nearly 400 million by 2023. In such a big market, digital services led by e-commerce, gaming, and media supported by digital payment services are considered to be an important boost for economic growth.
The banned 59 Chinese apps in India 2020 will lead to grown more downloads in the homegrown app, Yet the country hasn’t taken giant steps towards digitization of the economy. It has begun to lay small steps in the process of building a digitally-driven economy. Even after multiple attempts by the government to fasten the growth of the digital economy, the country is growing at a slow rate.
Chinese digital economy rose by the success of the three giants Baidu, Alibaba, and Tencent. It is similar to how US tech giants Google, Amazon, and Facebook which helped the growth of multiple sectors like e-commerce, fin-tech, and search engine to build a complete digital-driven system. India is now seeing some emerging players such as Flipkart which are re-shaping the market to develop a digital way of living.
Back in 2015, the Start-up India initiative was launched by the Modi government with a corpus of Rs 10,000 crores. The amount announced is not big when compared to global standards. As of December 2019, the government managed to release only 700 crores under the Start-up India campaign.
PM Modi, during his 2019 election campaign announced the decision of doubling the funds for Start-up India up to Rs 20,000, delay in the release of funds earlier affected the enthusiasm in the startup community.
A study conducted by the RBI in December 2019 revealed that 1200 surveyed start-ups received only around 0.6 percent funding from the Small Industrial Development Bank of India (SIDBI). The survey revealed that the largest source of funding for startups in-country is friends and family, not the government.
Lack of innovation has been one of the major reasons for launching apps that are unique. The Oxford Economics Entrepreneurial India study says 77 percent of venture capitalists felt that the Indian start-ups lack a unique business model idea.
One of the popular banned Chinese app in India 2020 was Tiktok-
TikTok is not a copy of any existing application but a new idea for a 15-second short video creator app, unlike any other app. This helped it to create its own user base in the world. Apps with unique ideas behind them often become giants in the technology industry.
However, things are changing for homegrown Indian apps too. In 2019, of the top 200 apps on Google Playstore India, 42 percent were made in India. That’s up from 38 percent in 2018 on Playstore. Now this number will increase further due to the banned 59 Chinese apps In India 2020.