How Is the Indian Ban on Chinese Smart Apps Affecting China's Economy?

Published September 8th, 2020 - 03:00 GMT
How Is the Indian Ban on Chinese Smart Apps Affecting China's Economy?
When the Indian government banned the popular video-sharing app TikTok last June, the platform lost 30% of its users base. (Shutterstock: Tomasz Makowski / spainter_vfx)

Remember when India banned 59 Chinese-developed and owned apps last June following border clashes that resulted in several deaths? Well, the list has just grown bigger mounting to 118 Chinese apps.

Citing national security concerns, the Indian Ministry of Electronics and Information Technology released an updated list of banned mobile apps last Tuesday, adding the popular combat game PUBG to the no longer accessible applications.

China, on the other hand, deemed the Indian decision to be "discriminatory" and called on the government to acknowledge the mutually beneficial nature of China-India economic and trade cooperation."

Companies that have been affected by the ban so far are among the biggest in China, such as ByteDance, Tencent, Ant, and Alibaba.

According to Business Insider India, the Chinese developer of the popular video game PUBG, Tencent, has lost about $34 billion in the span of two days after the Indian ban last week.

Due to its large population of internet and smartphone users, India has always been one of the most important clients for mobile application developers worldwide, which is why an app ban in the country usually makes a major difference in the market.

For example, when the Indian government banned the popular video-sharing app TikTok last June, the platform lost 30% of its user base, which was considered a huge blow to the increasingly controversial app developer, currently under US pressure to sell it to a US-based tech company. Similarly, 24% of PUBG's over 700 million downloads were from India.

The multiple Indian digital strikes come at a time Chinese tech developers and manufacturers are under immense pressure exerted by the Trump administration to curb the Chinese tech advancement that has recently achieved a number of milestones, such as the 5G technology and high-quality affordable devices manufactured by the Chinese giant Huawei, in addition to the global success achieved by the blooming TikTok app.

While the Indian crackdown on Chinese tech was expected to help Indian tech developers reach a wider range of users, who can no longer enjoy their favorite apps, especially as Indian developers have started to offer alternatives to the most popular Chinese ones, experts are worried this policy could backfire affecting the $4 billion Chinese investments in the Indian market, as 18 out of 30 Indian tech unicorns receive Chinese financial support, reports The Week.

According to CNBC, Indian policies against Chinese apps could be a golden opportunity for US tech giants such as Facebook and Google, who could rush to provide the huge Indian market with alternative apps.

Meanwhile, Indian developers have also seized a golden chance in the wake of bans imposed on Chinese apps, as they started offering alternative apps with the same services and features the Indian user is expected to miss.

Over the last few months, many Indian smart apps have emerged or triggered a strong interest by users who are no longer able to use the Chinese popular ones, among these are Roposo, Insta Reels, ShareChat, Aii Social, YouTube Shorts, MX Takatak, Fun 2.

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