Indian and Chinese companies have a symbiotic ecosystem for growth
A CII and Evalueserve study, published recently, stated that the economic ties between India and China would continue to grow. A promising and positive finding, it resonates with my understanding of the two economies as well.
The two countries share a lot of similarities, and if there is any country that comes even close to the phenomenal rise of China, it is India. With a large consumer base, India is what China was a decade ago— young, digital-first and full of untapped potential.
When it comes to technology providers, India and China are a perfect balance of expertise and untapped potential, native intelligence and intellectual capital. Collaboration between the two will only be a win-win, as their strengths are conducive to creating a holistic ecosystem.
India is undergoing a digital boom with the advent of Gen Z, the generation of true digital natives. With first-time Internet users emerging due to widespread Internet penetration and affordable smartphones, India is more connected than ever, especially with the tier 2 and 3 markets. As established by an ASSOCHAM-PwC joint study, the number of smartphone users in India is expected to double to 859 million by 2022 growing at a compound annual growth rate of 12.9 per cent. It makes India a lucrative market for technology companies.
As Internet usage in China stabilises, there is limited room for the technological boom in the country. Hence, India’s position as a lucrative market continues to strengthen.
Setting up a business in India requires a lot of preparation. Understanding the heterogeneous population, diversity of languages and cultures, existing players and the elaborate regulatory structure is important. Chinese companies have undergone a growth trajectory in their regions, and, hence, have experience and technology. However, to sustain in India, building the right team and hiring the right talent is important. As more users come online from tier 2 and tier 3 cities, the conversations are moving to hyper-local communication. We have the technology infrastructure, artificial intelligence and deep learning stacks to understand data consumption and interaction patterns. However, we rely on locally hired talent to intelligently analyse it and help improvise the products to suit the heterogeneous Indian audience.
Chinese entrepreneurs have seen success and learnt from their journey to scale businesses in China. They have a playbook ready for reference when they evaluate other geographies as business prospects. With that experience in technology, and the untapped potential in India, it is a natural tendency for them to look to India for the next growth trajectory.
What these entrepreneurs also acknowledge is that while the playbook can help them set up, customising the playbook to the Indian audience is imperative. Be it understanding the social, economic and political structure of the society, or appreciating the local diversity of the country–Chinese technology providers are creating a brand perception of being as close to India as possible.
Today, India is like what China was a decade ago. By collaborating with Chinese technology providers, India will be able to expedite its journey to building an ecosystem, which is mobile-first and led by IoT (Internet of Things).
It is for these reasons that technology providers in India should see China as collaborators while Chinese see India as an important market for growth and acceleration.
