The recent initiative by the Ministry of Home Affairs to recommend a ban on 54 Chinese mobile applications, including the widely used game Garena Free Fire, has sparked discussions surrounding privacy and national security. This decision comes on the heels of a similar move in 2020, which saw popular short video apps from China, such as TikTok, being banned. These actions aren’t simply geopolitical strategies; they have widespread economic implications too.
Economic Impact of Banning Chinese Apps
The banning of Chinese apps is a critical strategic trade manœuvre capable of significantly influencing the economy. In 2021, India’s trade with China crossed USD 125 billion, with imports from China nearly hitting a record USD 100 billion. This indicates a strong demand for a variety of Chinese products, particularly machinery. However, the banning of these apps paves the way for local IT talent to cater to the emerging internet user base.
Pros of the Ban Decision
Banning Chinese sites and apps enables Indian IT specialists to cater more effectively to native Internet users. Top tech firms from Silicon Valley (US) and China have been vying for the Indian consumer in both hardware and software sectors. Simultaneously, India focuses on exporting IT services without adequately servicing its domestic tech market. The prohibition of these apps also communicates India’s determination not to succumb to China’s Nibble and Negotiate policy.
Impact on China’s Ambitions
The decision to ban could potentially impact one of China’s crucial objectives – becoming the 21st-century digital superpower. The Chinese Internet industry requires India’s expansive user base of over 500 million netizens to act as a testing ground for their Artificial Intelligence algorithms.
Data Recognition and Security
India’s app ban reflects the understanding that data streams and digital technology serve as a new currency of global power. The increasing importance of data is recognized, leading to a review of the restrictions on telecom hardware and mobile handsets.
Cons of the Ban Decision
While Chinese apps have been banned due to data privacy concerns and unauthorized data transmission to foreign servers, these issues aren’t exclusive to Chinese software. Moreover, despite the ban on Chinese mobile apps, India continues to rely on Chinese products in various critically important sectors. After banning over 118 Chinese apps, Indian tech companies have attempted to fill the gap with copycat creations. However, these substitutions fail to leverage the full potential offered by China’s exit.
The Way Forward for Indian IT
India’s main IT goal should shift from servicing foreign entities to fulfilling domestic needs. Rather than merely replacing what was provided by Chinese firms, Indian entrepreneurs should focus on delivering high-quality, nationally-used services and products. The new digital products should cater to localized necessities and preferences, providing opportunities for specialized Internet services designed for and by local communities.
For example, apps offering specific market prices, local transportation routes, non-traditional banking methods, education, health, online sales, classified advertising, etc., present numerous commercial opportunities. The ban of Chinese apps serves as a springboard to develop a self-reliant digital ecosystem that caters uniquely to Indian consumer needs.