China's crackdown on tech firms opens short window for Indian starts-ups

Beijing's decision to crack down on its tech start-ups has opened a window of opportunity for domestic start-ups, but it could close soon too

indian startups

Imaging: Ajay Mohanty

Surajeet Das Gupta New Delhi
The Chinese government is imposing severe restrictions on their tech companies — whether it is on data security, marketing practices or floating an IPO. Should this be music to the ears of Indian start-ups and home-grown private equity (PE) funds?

Ask Indian start-ups and the answer is a resounding “yes”. But ask the domestic PEs whether they see a shift in allocation of money by their institutional investors and high net worth individuals (HNIs) from China to India and the answer is a resounding “no”.

But caution about investing in China is clearly visible. At the macro-level, the yawning gap in PE investments between India and China has narrowed (see chart).

First Published: Aug 26 2021 | 06:03 AM IST

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