Chinese companies face an uncertain future after India’s app ban
China’s messaging app WeChat stopped providing services to some Indian users on Saturday, following an earlier ban of Chinese apps by the Indian government. Analysts believe it is a proactive move that more Chinese companies will take to be “more discreet” under the tightening of the Indian government.
Some WeChat users in India saw their services affected on Saturday, as many reported they were unable to send and receive messages, and their accounts were logged out automatically from the platform.
According to a source in India, WeChat has been sending notifications to some of its Indian users that it is unable to offer services “pursuant to Indian law,” and is “engaging with relevant authorities” in hope of resuming its services.
Scott Wang, head of a China-invested fintech provider based in Gurgaon, India, told the Global Times on Sunday that the move seems to be targeting WeChat accounts registered with Indian mobile numbers.
“Our employees with Indian phone numbers were automatically logged out of WeChat,” said Wang, noting his WeChat account, which was linked to a Chinese phone number, is still functioning normally.
Neither WeChat nor its parent company Tencent has replied to the Global Times on the matter as of press time.
Some analysts believe that WeChat’s move is probably Tencent’s voluntary decision based on India’s worsening business environment for Chinese apps, instead of at a direct request by the country’s government, as companies try to lower potential risks amid uncertainties over how the Indian ban on Chinese apps will unfold.
On June 29, the Indian government announced a ban on 59 Chinese apps, including some of the biggest tech behemoths, such as WeChat and TikTok, which were wildly popular in the Indian market.
Shortly after the ban, WeChat was taken down from Google Play and Apple store, but users with the apps already installed were still able to use them. However, without clear guidance on if, how and when the apps will be completely be removed from the Indian market, WeChat has been making tentative moves to reduce its services since the ban was announced in June.
A source based in New Delhi, surnamed Hu, told the Global Times that his WeChat account has been subject to restrictions since June 29, allowing him to send and receive messages, but sometimes it is restricted on dialing video and audio calls.
The Tencent move is in line with the Indian government’s ban on Chinese apps, and Chinese companies are taking a more cautious stance with their operation in India, Li Jian, founder and CEO of Draphant, a Chinese consulting firm focused on Indian investment services, told the Global Times on Sunday.
“As the ban is unlikely to be lifted anytime soon,” said Li, and the attitude of ‘being more discreet’ will resonate loudly with Chinese companies’ deep-seated anxiety over their future in India.
Since the ban in June, the Indian government has been ramping up efforts to squeeze some Chinese companies out of its local market. According to Li, there is little chance to overturn the ban on the apps. “It largely depends on the top behemoths in the business. Unless Bytedance, the parent company of TikTok, is willing to go out of their way to make efforts with the Indian government, the ban will always be on.”
ByteDance could lose up to $6 billion after the ban, the Global Times reported earlier.
According to data from Sensor Tower, a mobile app analysis company, TikTok was downloaded 112 million times in May, with 20 percent of that total in the Indian market, double that of the US market.
A user swipes on his smartphone while WeChat logos appear in the background, 14 May 2020. Photo: IC
