India banned ByteDance Ltd.’s viral short video service TikTok and 58 other Chinese apps, citing threats to its sovereignty and security as relations between the world’s two largest populations worsened.
The unprecedented moratorium, announced days after escalating border tensions in the Himalayas left 20 Indian soldiers dead, deals a blow to the most prominent names in Chinese technology. The banned services included e-commerce giant Alibaba Group Holding Ltd.’s UC Web, social media leader Tencent Holdings Ltd.’s WeChat and Baidu Inc.’s map and translation platforms.
The move marks another attempt by India to reduce dependence on its neighbor’s products and hampers efforts by China’s largest corporations to expand beyond their own borders — a collective endeavor encapsulated by TikTok’s phenomenal success abroad and particularly in India, ByteDance’s largest international market. The world’s most valuable startup responded by saying it wants to work with Modi’s government to improve security for its hundreds of millions of domestic users.
“Building empowered local management teams in the countries where TikTok operates, including India, has been critical to our global success,” the company said in a statement. “Our team of around 2,000 employees in India is committed to working with the government to demonstrate our dedication to user security and our commitment to the country overall.”
The ban threatens to escalate tensions between two of Asia’s largest economies. As the border standoff that had simmered for nearly two months worsened, customs officials began halting clearances of industrial consignments coming in from China at major Indian ports and airports. The ban announced Monday also includes smartphone maker Xiaomi Corp.’s Mi Video Call and Weibo, a Chinese Twitter-like service.
“Despite attempts at de-escalation and multiple rounds of talks, tensions are still high” between Bejing and New Delhi, Eurasia Group analysts led by Akhil Bery wrote in a note Tuesday. “Beijing has been taking a low-key approach to the dispute in China’s state media, but India’s highly public move will make that difficult and raise expectations from the public of a strong response — particularly in a climate where the leadership has been ramping up patriotic sentiment amid the pandemic.”
The unauthorized transmission and storage of Indian users’ data in overseas servers and “its mining and profiling by elements hostile to national security and defense of India” is a matter of deep and immediate concern requiring the emergency measures, the Ministry of Electronics and Information Technology said in a statement on Monday. Representatives for Tencent and Baidu didn’t have immediate comment when contacted.
Still, it’s unclear how the ban will be implemented as most of these apps already reside on users’ phones. The government might need to block the app servers and prevent new users from downloading them. One in three smartphone users in India will be impacted by this ban, Tarun Pathak, associate director with Counterpoint Technology, told BloombergQuint.
Meanwhile, the government’s decision to bar the apps began garnering support on social media.
“It’s time to take some hard decisions to get out of China’s cyber clutches,” Nirmal Jain, chairman at financial services conglomerate IIFL Group, tweeted.
While banning other Chinese-made products and hardware is challenging in Asia’s third-largest economy, the blockade of a wide swath of Chinese apps ranging from gaming and news content to music streaming and online retail is particularly significant.
India, with its half-billion internet users, is an emerging arena for global technology companies from the U.S. to China. As hundreds of millions of first-time users come online in India, they do so on Chinese smartphones. Myriad Chinese apps are their doorway to the internet.
For ByteDance, which counts India as its biggest market with over 200 million TikTok users, the move is a particular blow. ByteDance faced a brief ban in India last year, and is being scrutinized in Europe. It also faces mounting questions from U.S. policymakers over whether it jeopardizes national security.
“Some of these Chinese apps are not just for commerce but have deeply entrenched into the social fabric of our lives,” said Anil Kumar, chief executive officer of technology researcher RedSeer Consulting. “They know what you do, what you say, where you go. In the current context, they can be viewed as a threat to our national security.”
Click to enlarge
