By Viral Jani
In the last few decades, India has rightfully consolidated its position as one of the world’s fastest-growing economies. Due to a variety of market conditions, such as widespread internet penetration, accelerated growth in digital services, and by being the world’s largest open internet market, the subcontinent offers unique opportunities for global organizations looking at international expansion. India’s booming domestic market opportunity, a highly sought-after quality talent pool, and an open regulatory environment are other factors that add to its appeal.
Recognising this potential, various global category-leading companies have made their way into the Indian market in the last few years and have seen tremendous success. With over half a billion internet users, India is one of the largest and fastest-growing markets for digital consumers. The upwardly mobile segment of consumers in India which is global in its outlook and is conversant with English tends to be early adopters of the global products and services in India.
In many categories, this early success of global products has spurred Indian startups to launch products catering to a similar product-market gap. Interestingly, the ‘early adopter’ behavior is now not limited to audiences in metro cities but has trickled down to consumers in Tier 2 and 3 cities, which explains the rise of local start-ups in India that are building products and services for a wider market set and for tapping the untapped potential of smaller towns and cities in India.
Of late, these markets have been delivering never-seen-before success to even niche sectors such as fintech, edtech, consumer tech among various others, an opportunity that both global and Indian start-ups are looking to tap. Key drivers of this growth include the growth witnessed across fintech platforms, growing acceptance of digital payments and the rising purchase power of the Indian consumer.
This growing participation from Tier 2 and 3 markets that are swifty embracing latest technologies, has pushed the envelope for local startups in India. From Uber in ride-hailing, Amazon in eCommerce and Coursera in online education, these global organisations have raised the bar for local players, pushing them to transform or evolve for better serving the evolving demands of the Indian consumer.
Another noteworthy trend in this space has been how many of these global behemoths are not just expanding their own operations in the country but also investing in and partnering with Indian start-ups, which has led to India becoming one of the fastest growing major economies in the world. Uber’s collaboration with PayTM to offer digital payments wallet service to Indian consumers, was one such unique and pioneering initiative that was primarily undertaken to reach a broader audience set in India, including the ones in smaller cities.
The partnership between Meta and Reliance Jio that brought together two behemoths to expand their retail and telecom business in the country, enabled new opportunities for SMBs across India and democratised access, all on the back of digital technology integration. While tapping the massive business opportunity that India presents, global organizations continue to play a crucial role in developing and strengthening a culture of innovation in the Indian startup ecosystem, while promoting a sense of healthy competition. All these indicators combined are priming the Indian economy for the digital era, at a pace much faster than many emerging and mature markets.
As global companies expand their foothold in the Indian market, they are focused on integrating new-age relevant technologies in business operations such as blockchain, automation, IoT and more. Global giants such as Uber, Amazon, Headspace, among others have been the first movers in their own categories, to embrace cutting-edge, sustainable and smarter ways to innovate in the Indian market. Over the years, this has encouraged various indegenous startups that have witnessed exponential growth on the tech and innovation front. These trends have ultimately led to category expansion where both global and local players have found their niche, and are coexisting in a vibrant market opportunity that India today represents.
It is heartening to see that India has come a long way from being a destination for low-cost, outsourced software and support services, to becoming the tech and innovation hub for various global organizations. Some of the world’s largest global companies like Microsoft, Uber, Coursera, Google, Apple, among others have set up their innovation hubs in India while some are innovating in India, for the world.
Despite recent disruptions, the presence of global organisations in India has provided a golden opportunity for local start-ups to learn and scale faster than ever. Also, India’s huge potential to grow exponentially and faster than any other emerging nations provides a huge opportunity for global companies to remain invested in the country.
Winning in India requires a long-term vision, a customized market approach and a sharp focus on the country’s early adopters who would become users of the standard global offerings. Recognizing that there are many Indians within India that are, collectively, more diverse and unique than an entire continent, the opportunities for global and Indian businesses are endless.
(The author is EVP & Country Head, India, Times Bridge. Views are personal.)