How India's Ban On Chinese Apps Can Trigger A Realignment Of Global Digital Order

It is important to view the recent ban on Chinese applications within the context of how the digital economy has shaped up over the previous decades while considering its likely progression over the coming few years.

For starters, the global tech industry has been largely dominated by American tech giants such as Google, Amazon and Facebook which have emerged as some of the world’s leading platforms offering a wide range of services.

The reason for their success was their ability to scale, that is, to have more users on their platforms by moving into other developed markets. This gave them the unique ability to expand the scale of their operations reducing the per-user cost, making a lot of their ventures viable over the long-term.

However, one country repeatedly denied several of these tech platforms access to its domestic market. That is, the great Chinese firewall prevented several global tech giants from creating a strong presence within their country, even as China attracted hardware manufacturing, especially in the context of electronic items such as computing devices, telecom equipment and smartphones.

The local population of China made it possible for them to promote their home-grown companies and the firewall acted as a barrier which protected domestic companies from foreign players. This gave rise to several of their domestic tech giants such as Alibaba, which has since then invested in several other start-ups across the world.

Even with China’s domestic population, global tech companies continue to have an edge by virtue of their presence across the world and that made access to Indian market imperative for the Chinese tech companies.

India, with the world’s second largest population and the fastest growing internet user base due to lower internet tariffs was absolutely essential for the Chinese tech-leaders to scale their operations to the level of creating their own platforms. These platforms would have been instrumental in creating a digital infrastructure similar to how CCP has augmented physical infrastructure through its Belt and Roads Initiative to further establish Beijing’s hegemony in the 21st century.

India’s recent ban of some of these applications is therefore a far more significant blow as it not just affects these companies and cripples their growth objectives, but more importantly, it has an impact on the CCP’s larger vision for the 21st Century.

While several analysts have been quick to point out how these applications helped the “real India” and that the ban will affect livelihoods etc, none of these analysts gave similar arguments against the great Chinese firewall.

Indeed, some of these applications did benefit individuals, but that benefit came at the cost of user data so it would be worthwhile to ask these analysts whether it is fair to compromise on the data of our citizens and allow companies to share it with a regime that has a questionable track record of dealing with its own citizens.

In the context of India, several tech companies have already come out with the alternatives to some of these applications and government has even announced a challenge under the innovate India banner to help some of these programmers to scale up their applications.

But, the broader implication of this ban has to do with a reorientation of the global economic order, especially of the digital economy where we see countries limit the extent of role played by the China.

With the US encouraging countries to ban Chinese telecom equipment and India’s ban on applications and strong data-localisation laws, it is safe to assume that the digital economy will find a new international regulatory system over the coming few years.

It is indeed possible that this new system could see India play a proactive role owing to the scale it offers of both consumers and of techies.