India-China Bonding: How Tech Sector Can Gain?

by Sohini Bagchi    May 21, 2015

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India and China have come a long way, making their strong presence felt on the global platforms, despite western dominance and various economic and political pressures. The visionary Prime Minister Jawaharlal Nehru stated that if China and India come together, the future of Asia is assured. And in 2015, PM Narendra Modi moved another step forward by forgoing a stronger relationship with China – which is likely to benefit the technology sectors, among other businesses, in both the countries.

Tech companies upbeat

Experts believe it makes sense for India to collaborate with China in matters of business, as Chinese brands are already becoming popular to the Indians. Xiaomi, for example, now the fifth largest smartphone vendor in the world, has already sold more than 1 million units in India since it entered the market last year. Xiaomi’s popularity is soaring with the launch of its latest Mi 4 phone in the country, which has already taken a seat beside Samsung and Micromax.

Xiaomi is further upbeat on PM Modi’s ‘Make In India’ drive. With less than 5 percent market share in India’s smartphone segment at present, handset maker is setting up a local manufacturing unit in the country by the end of this year - its commitment has encouraged business tycoon Ratan Tata to announce an undisclosed personal investment into the company.

China-based OPPO is also looking to tap India’s rural market with budget smartphones. It is also closely watching the government’s ‘Make in India’ initiative and is keen participate in it. “We are planning to come up with low-range and mid-segment smartphones which fits the budget and delivers the best-in-class experience,” OPPO Mobiles India Chief Executive Tom Lu told ET.

Read more: Why Chinese Phone Makers Are Now Heading India?

Coming to Internet services, China’s tech giant, Alibaba Holdings is noticing the high growth potential  in the country’s  e-commerce space. Alibaba, with its world’s largest IPO valued at $25 billion, has announced an investment of $575 million into one of India’s mobile wallet Paytm, after Alibaba’s launch of its successful Alipay. It is currently in talks with Micromax, India’s largest smartphone maker, for a 25 percent stake, amounting to $1.25 billion, in Micromax.

Chinese internet services company, Tencent Holdings is also looking into India’s growing mobile space through its flagship messaging app, We Chat which has seen huge success in China. While Whatsapp and Facebook messenger are still the dominant mobile messaging apps in India, in just under a year We Chat now has 27 percent of India’s mobile messaging market.

India’s can learn from China?

Unique use of marketing strategies, a strong understanding of technologies and competitiveness are some of the lessons India can learn from China in matters of business.

From the days of low-tech manufacturing, China has evolved into to advanced level of services, with a focus on unique, innovative consumer technologies. China’s internet companies are plunging into non-commercial spheres, such as e-governance – something that can be of huge benefit to India’s Digital India initiatives, believe experts.

 China will spend more than $182 billion to boost internet speeds by the end of 2017, the State Council body said, as Beijing moves towards a more service-driven economy to boost growth. The government will invest generously to accelerate the development of fiber optic broadband and high speed 4G mobile networks.

China has also unveiled a vision to move to the next level of growth, advancing in areas such as e-commerce, green energy and bio-engineering by 2025.

From civilian drones, to smart-watches and hundreds of connected devices in the Internet of Things space, China is leveraging on the “Internet Plus” initiative that aims to integrate mobile internet, cloud computing, big data and the Internet of Things, India can take a lesson or two from China’s tech and internet revolution and establish its position, using public-private partnerships, when addressing social issues such as healthcare, public utility and education, among others.

Read more: India, China To Fuel Mobile Advertising

While both the countries have been strong competitors and as experts point out the Chinese business models may not always work out in India, both the nations can learn from each other by adopting the best practices. As India is on a makeover spree – pushing itself globally with innovative technologies and strategies, a strong collaboration with China can help it recognize its potential even faster.