Indian start-ups race to fill the gap after Chinese app ban

Indian start-ups race to fill the gap after Chinese app ban

While there may be question marks over India’s ability to cope without some Chinese goods and technologies if India decides to block them, the recent banning of 59 Chinese apps may offer real opportunities for Indian companies.

According to Indian press reports, local entrepreneurs and venture capitalists have welcomed the ban, suggesting it could boost local companies, particularly those operating in the ecommerce, social media and gaming sectors.

In particular, the race to replace China’s social media app TikTok, and get a portion of its customer base, is heating up. A new set of Indian start-ups in the social and short-video sharing space – like Chingari, Roposo, Trell, Vokal, ShareChat and Mitron – have quickly picked up business in the wake of the ban. Chingari was said to have gained one million new users in only 24 hours.

TikTok is certainly worried. Its chief executive Kevin Mayer insisted in a video presentation that the company has complied with all data privacy and security requirements. ByteDance, which owns TikTok and regional social media platform Helo, counts India as its largest market outside China. 

The market is, of course, a big one as the enormous success of TikTok, short video platform Likee and ecommerce companies like Club Factory and SheIn, has proved. Now they, along with gaming apps such as Clash of Kings and Mobile Legends, have been included in the list of banned Chinese apps, potentially opening up opportunities for local players.

Changes to foreign direct investment rules and slower checks on Chinese goods at ports and airports have already adversely affected the flow of goods from China, but they have also affected Indian companies using Chinese components.

In theory, there are fewer penalties on Indian businesses from banning Chinese apps. However, there may also be the question of job losses: many Chinese app providers have Indian employees, who could suffer unless the situation is resolved.

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