32 C
Mumbai
Thursday, February 25, 2021

Google to invest $10 billion — how exactly can it help the digital India initiative?

The dream of a digital India in its true sense might just be possible. While the Digital India campaign has been on for quite some time under the leadership of Prime Minister Narendra Modi, it has not really penetrated real and rural India. Smart cities remain a namesake in most parts of the country while internet connectivity as an issue has surfaced more than ever as the country went into a lockdown and its citizens were locked in at home. But that might just change over the years with Google stepping in with a huge $10 billion investment to connect India. With Google’s investment, how exactly can it help the digital India initiative?

 

The investment

But Google is not the first to Invest in India. In the recent past, India has seen investments coming in from Facebook, Amazon, and Apple this year. Facebook announced an investment plan of a whopping $5.7 billion in April. Amazon, in January this year announced an investment of $1 billion in India while Apple’s primary manufacturing partner, Foxconn, invested $1 billion to expand its production in India. While some attribute this to the strict regulation of China when it comes to investment by tech majors, others argue this can also be the effect of the worldwide rejection of Chinese companies and production bases.

Now, let us come back to where we started — the $10 billion investment by Google. Where will the tech major or rather its parent company invest? Well, they came with a structured plan. “When I was young, every new piece of technology brought new opportunities to learn and grow,” Google CEO Sundar Pichai said while making the announcement. “But I always had to wait for it to arrive from someplace else. Today, people in India no longer have to wait for technology to come to you. A whole new generation of technologies are happening in India first,” he added.

The PM seemed pleased with the interaction too. “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,” he tweeted later.

 

Digital India on the way?

Google has decided to enable India digitally in every sphere of life — affordable access to information for all Indians in their native language, integrate AI and the latest tech in public goods like education, health and agriculture, the digital transformation of businesses across the country and last but not the least, developing Google products which are specially designed for India.

But wasn’t internet-enabling and reaching to the farthest parts of the country a mission Mukesh Ambani’s dream which he was on his way to fulfill with free Jio internet? You won’t be entirely wrong if you ask this and days after the investment announcement Google revealed that a majority of its investments will be towards Jio. A total of $4.5 billion — almost 50 percent of the total investment. This too was not the first. Remember the $5.7 billion investment by Facebook? That too was directed towards Jio. Mark Zuckerberg’s social networking platform bought 10 percent of Ambani’s Jio. Seems like a plan.

 

The investment in Jio

Google and Jio are set to launch entry-level Android phones that would be accessible to every Indian. More than 500 million Indians still do not have access to mobile phones and that’s the reality these two market majors are set to change with their humungous investment and extensive network. The new mobile is set to be a significant test to Chinese sellers, for example, Xiaomi and BBK Electronics, proprietor of the Realme, Oppo, and Vivo, which as of now rule a $2 billion (generally Rs. 14,955 crores) market for sub-$100 (generally Rs. 7,400) cell phones in India. Fueled by a shrewd blend of Bollywood, cricket-driven advertising, and item highlights, for example, amazing cameras, the Chinese firms sell around eight of each 10 cell phones in the nation.”If history is anything to go by, Reliance will undercut other brands and pose a real threat to the low-end smartphone market,” said Rushabh Doshi of tech researcher Canalys.

But Google’s investment has initiated some peripheral investments as well. Google is set to buy over 2 million sq ft commercial space in Hyderabad. It has also signed up for 450000 sq ft office space in Intellion Edge reported Economic Times. Uttarakhand CM Trivendra Singh Rawat wrote a letter to the tech giant Google’s CEO Sundar Pichai asking for investment in the state. He also appointed Chief Secretary Utpal Kumar Singh and additional chief secretary of MSME department Manisha Panwar to follow up on the developments.

“In his letter, he stated that there is a need for an alternative development model due to the Covid-19 pandemic in which IT has a very vital role to play. He also said that small cities have vast opportunities in investment for giants like Google. If chosen, the Uttarakhand government will provide every possible help to Google in the state,” an official told Hindustan Times. Utpal Kumar Singh also added, “The CM in a proactive manner has made a pitch seeking investment from Google. We believe Uttarakhand is very well suited for it with the kind of advantages the state enjoys. As directed by the CM, I and additional chief secretary Panwar will establish contact with the people concerned in Google in this regard. We will help them with whatever information they need or field visits required for investing here.”

He also added, “As of now Google has made the announcement for an investment of USD 10 billion and its details are yet to be known. Once we know that, then we will talk to them on the kind of investment they are looking for and we are looking at.” This would not only boost the Indian economy which is in a rut and was in a bad space even before the COVID-19 pandemic rises faster from the slump but it will also boost every sector that involved generating higher productivity.

 

Do not have time to read? No problem. Platocast’s State Of Economy is a weekly Indian Economy podcast where we aim to provide context on the economic news of the week. Listen here. 

Listen to India's best podcasts.

Listen anywhere, anytime.

Platocast podcasts are sourced carefully to bring you the best stories out there.

Latest news

Related news

LEAVE A REPLY

Please enter your comment!
Please enter your name here

This site uses Akismet to reduce spam. Learn how your comment data is processed.