, Edited by Explained Desk | New Delhi |
Updated: July 14, 2020 12:51:25 pm
A Google logo in Mountain View, California, US, November 1, 2018. (Reuters Photo: Stephen Lam)
Tech-giant Google Monday announced plans to invest $10 billion in India over the next 5-7 years by way of equity investments, partnerships and other arrangements to “accelerate digitisation” in the country.
The announcement assumes particular significance given the impending gap in the country’s tech investment ecosystem following the Centre’s clampdown on Chinese technology firms.
During our interaction, @sundarpichai and I spoke about the new work culture that is emerging in the times of COVID-19. We discussed the challenges the global pandemic has brought to areas such as sports. We also talked about the importance of data security and cyber safety.
— Narendra Modi (@narendramodi) July 13, 2020
How will Google invest from the $10-billion fund?
Google said its $10-billion fund would focus on areas such as enabling affordable access to the Internet and to information for every Indian in their own language; building new products and services in segments like consumer tech, education, health and agriculture; empowering businesses, especially small and medium ones, to transform digitally; leveraging technology and artificial intelligence for digital literacy, outbreak predictions, and support for rural economies.
These investments will be made through a mix of equity investments, partnerships, operations, infrastructure and ecosystem investments. These include Google’s existing projects such as Internet Saathi for spreading awareness of the Internet in rural villages and an artificial intelligence-based flood forecasting system, among others.
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Is this a reaction to the curbs on Chinese companies?
While the fund may have been in the works since before the clampdown on Chinese companies, the development did present an opportunity for tech majors like Google to grow their share in India’s internet pie.
Big technology companies like Google, Facebook, Netflix and Twitter are, in any case, prohibited from doing business in China. Potential hurdles for Chinese companies investing in India could provide better prospects for American giants to strengthen their position in a market which has the second-most Internet users in the world.
What are Google’s top investments in India so far?
Google has invested in various startups and ventures in India through several of its investment vehicles. On November 1, 2013, the company invested Rs 3.13 crore in Sana Ventures in the seed funding round, and Rs 3 crore in Agastya International Foundation.
Since then, it has invested in $45,000,000 in Dunzo and Rs 39 crore in the online education portal CueMath.
In its latest investment on June 24, Google put $27,500,000 in the Series E funding of a Gurugram-based company Aye Finance.
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How does this compare with Google’s global investments in tech ventures?
Compared with its global investments, investment in India dwarves, but the $10 billion as part of the ‘Google for India Digitization Fund’ will boost Indian companies in Google’s portfolio. Between January 1, 2010 and July 13 this year, Google and its venture capital arms have invested in more than 900 companies globally. Among these, it has the maximum investments of $1.5 billion in Indonesian multi-service startup Gojek, $1 billion in ride-sharing firm Lyft, $1.4 billion in its rival Uber, and $1 billion in Elon Musk’s SpaceX.
How does this announcement figure in big-tech’s outlook on India?
Google’s investment plan is in line with big-tech’s bullish outlook on India. Earlier this year, Amazon said it would invest an additional $1 billion in India. This was followed by a marquee investment announcement of $5.7 billion by Facebook in the country’s largest telecom company Reliance Jio. Last month, Microsoft’s venture fund M12 said it would open an office in India to pursue investment opportunities focusing on B2B software startups.
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