PM MODI STRIKES A DEADLY BLOW TO CHINA’S TECH AMBITIONS

The US side is putting in place measures designed to constrict the supply of dollars to China, including through delisting Chinese companies on US exchanges. The Modi app ban will compress Chinese company valuations further, which will fall more and more with every new entry into the app ban bandwagon.

Commentators less than receptive to Prime Minister Narendra Modi have been pointing out that trade with India forms only a small part of China’s overall trade, and hence that any trade war initiated by India would prove futile. They seldom mention the fact that India accounts for the second largest trade surplus of the PRC, next only to the United States. And critics of Modi may not accept (or even be aware of the fact) that the move to criminalise the use of as many as 59 Chinese apps that are of everyday use in India could potentially shave off hundreds of billions of US dollars from the valuations of Chinese companies. While de-linking of hardware from China may take longer (although security considerations mandate that such a process start), apps are a different matter. Some may argue that VPNS would enable users to access the banned apps, but this would be used by few. Most would switch to other, more accessible, apps. The replacement of the banned apps by domestic alternatives would be a matter of weeks, not the months or years needed to replace hardware, for example in telephony systems. In India, careless security has resulted in ZTE and Huawei dominating the back ends of the entire mobile telephony network, a situation that calls for immediate remedial action. Over the last decade (an eternity of time in the digital age), both societal implications as well as value creation have been far faster and more profound than in the case of hardware such as 3G, 4G or 5G. Most of the entities developing and marketing apps valued at several billion dollars each were not even around before 2009. Whatsapp and Uber came on the scene that year, Wechat in 2011 and Tiktok in 2016. Had the governance system in India not been as prone to sabotage by hostile alien entities as it is (given the ease of litigation and the forests of regulations needing to be navigated), several apps designed in India may have been world beaters, rivalling their international competitors and generating millions of jobs locally in the process. In this way, the mass culling of innovative enterprises that took place during India’s “Foreigner First Decade” would get remedied to an extent.

EXTEND BAN TO OTHER APPS

The list of 59 banned Chinese apps initially announced under the direction of the Prime Minister will need to get expanded to other apps that may later be adiscovered to be controlled from within China. This would immediately deprive the PRC of

A man carrying a sack walks past the graffiti of a healthcare worker fighting to tackle the spread of the coronavirus disease, in Mumbai, on Monday.