Is this Startup India and Make in India is just an illusion for youth in India. Yes, it is true because there is no major institutional investors in India. Neither government of India eases down the process for a start-up to get easy funds. Taking advantage of this situation, the Chinese government and investors started keeping a close eye on the Indian market. And Chinese investors have invested a lot of money in Indian startups in recent years.
This is said in a recent report published by the Indian Council of Global Relationship, Gateway House. The report also says that Chinese investors have invested around $ 4 billion USD in Indian startups. Today, 18 of the 30 unicorn companies in the country has investment from Chinese investors.
Chinese found an excellent opportunity for investment in Startup India
According to the report, there are three major reasons for China’s huge investment in India’s technology market. First, there is no strong institutional investor in India. Second, China provides long-term capital, which is necessary for start-ups. Third, India’s huge market has strategic importance for the retail business.
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Most of the investment from Chinese companies are made in India’s Tech Startups. There are about two dozen Chinese companies invested in approx ninety-two startups in India. The major Chinese investors are Alibaba, BiteDance and Tencent etc, These invested in top unicorns of India such as Paytm, Byzus, Oyo, Zomato, Ola, etc. Chinese investors have also invested in physical infrastructure in other emerging markets from India.
China’s largest investment in India by Fosun RZ Capital
Fosun RZ Capital has made its largest investment in Hyderabad based Gland Pharma in 2018. The total investment was around 1.1 billion US dollars as per media reports. Another big investment for Chinese investors done in Paytm, Ola, Uber, etc.
Opposite to this why Indian investors not able to encash these opportunities and don’t invest in Indian startups. It is because of their mindset. Generally, Indian industrialists only invest money in their own ventures. They also intend to takeover ideas for their own venture rather than supporting the original idea owners with investment.
Most of Indian investors run the family business or fun project based on political relations
Most of the investors who fund venture capital in India are either rich people or rich families. They cannot promise to give millions for startups to incur initial losses. Paytm had a loss of Rs 3,690 crore in the financial year 2019. Flipkart lost Rs 3,837 crore. Similarly, other startups to incurred initial losses but their investors continue to fund in the ideal. They believe their money will get a good return in the long run.
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Indian industrial houses also believe in getting funds with political help for their own project. They don’t invest in their own projects because they always have an intent not to pay back to the banks etc. That’s the reason why every government wave off billion of dollars for Indian corporates every year.
Government should handle Chinese investors carefully to save startup India
Now considering these facts Indian eye on global investors who invest many Indian ideas fro the long term. So China find this opportunity and invested in India and there is nothing wrong. They have created unicorn in India which has generated huge employment and boost the Indian economy.
Indian government should rethink its strategy in dealing with these forge in investors. They will not handle this situation delicately then Indian startups will be in deep trouble in the future. There will be no investor in the future…….
