India has become an “action zone” for Chinese investors like e-commerce giant Alibaba as its market attracted second highest Chinese funding in IT products next to the US, state media reported today.
Citing the fast growth of Indias e-commerce website Paytm which provides services to 130 million people in India, a write-up in state-run China Daily said, “India is not just another developing country – it is the worlds fastest-growing economy”.
“A huge internet population, rapid growth of mobile internet users, political stability, established institutions like judiciary, a thriving start-up ecosystem, renowned IT expertise and the promising market potential… all these factors have made India an attractive, almost irresistible proposition for Chinese investors,” the report said.
Apart from Ant Financial, China’s internet giants Alibaba Group Holding Limited and Tencent Holdings Limited have already invested in Indian tech companies, it said.
Smaller players and even start-ups in China are rushing to India as they see the country as the next frontier in internet-based businesses and a promising market for them to replicate Chinese tech giants success stories, it said.
While the Chinese investors look to flock to India to cash on the fast growing e-commerce market, there are also anxieties among Chinese investors over growing calls for boycott of Chinese goods in India following China’s blocking of India’s move to ban JeM chief Masood Azhar at the UN and blocking India’s bid to become the member of the Nuclear Suppliers Group (NSG).
Chinese officials said investment in India currently touched about $3 billion, which Indian officials said not much compared to the potential.
Quoting a report from itjuzi.com, a website dedicated to data on tech investments, the report said India has emerged as one of the most popular destinations for Chinese tech investors, second only to the US.
In the first half of 2016, Chinese internet giants and venture capital firms invested more than 42.1 billion yuan (USD 6.26 billion) in 60 tech-related projects overseas, including 10 in India and 33 in the US.
“India will be the next big internet market after China,” said Eric Shu, a senior partner with the Hangzhou-based venture capital firm InCapital.
“We believe many successful business models in Chinas internet industry can be copied in India,” Shu said, adding that as Chinas economic growth slows, Chinese investors are looking for opportunities abroad.