By Sherisse Pham and Rishi Iyengar
China and India are locked in a tense diplomatic and military standoff after a deadly border skirmish earlier this week. The economic stakes are high too, given the huge trading relationship and particularly close ties in technology.
India imports more goods from China than any other country. And over the past decade, India and China have enabled each other’s rise as emerging technology powerhouses. Chinese tech giants have invested billions of dollars into India’s biggest startups, while its smartphone makers dominate the country’s market and Indians have flocked to apps like TikTok.
Now, the dispute threatens those ties. Growing anti-China sentiment in India has alreadyled to calls for a boycott of Chinese products and services, while new rules on foreign investment could constrain China’s ability to cash in on India’s internet boom.
China has created a significant place for itself in India’s technology sector over the last five years, according to a report published by Indian foreign policythink tank Gateway House. Unable to convince India to sign on to its global infrastructure project known as the Belt and Road Initiative, China entered India’s tech scene by flooding the market with cheap smartphones from brands such as Xiaomi and Oppo and plowing money into Indian startups.
Gateway House estimates that Chinese investors have poured some $4 billion into Indian tech startups since 2015.
