Amidst the rising tensions with China of late, the Indian Government, through the Ministry of Electronics and Information Technology further banned 43 more Apps on 24 Nov 20 taking the total number of banned Chinese Apps to approximately220 which does not include clones of the Chinese apps which had been banned earlier during the year. The banned list now includes many prominent names such as Ali Express- an e-commerce app, Lalamove – a Delivery and Logistics App and Snack video – a replacement for the earlier banned App Tik Tok, CamScanner, Helo, Weibo, WeChat and Club Factory and many more.It is not a common phenomenon for two countries to indulge in an economic war but China forced India’s hand.

As per the Government,the ban was necessary because these Apps engaged in activities which impinged on the Indian user privacy and thus were prejudicial to the sovereignty and Integrity of India, Defence of India and security of State and Public Order. The biggest security concern lies in the fact that a lot of apps on smart phones collect massive amounts of data, which have nothing to do with the service they provide. China’s National Intelligence Law mandates and incentivizes private companies to work with national intelligence agencies and share information with them. This means that the data collected by the Chinese apps from their potential users can be accessible to the Chinese Government. There have also been several evidences that the data we casually copy on the clip-board, like maybe your bank OTP or any phone number or personal information is accessible and readable by these apps. The leak of such sensitive information can possess a major threat to the users of these apps as well as to our country.India recognises the importance of privacy of Data Bases, Data Streams and Digital Technology which are the new currency of Global Power and Economy. As per Reliance Joi, “data is considered as the new oil”. These Apps have been banned by invoking Section 69A of the Information Technology Act, 2000.

India is a big market for Chinese apps with few of the Apps being quite popular. These include Tik Tok which had as many as 100 million active users in India, File sharing tool SHAREIt about 400 million users, PUBG has over 50 million players in India and Alibaba owned UC Browser is at second place in Indian Market with a share of 10.19% after Google Chrome (78.2%). Some estimates point out that of the ten most downloaded apps in India, six of them are of Chinese origin. India and China are definitely counted seriously among emerging powers in IT, but competitiveness, as defined by the Economist Intelligence Unit (EIU) study is a much more complex game.

Through these bans, India has sent a message loud and clear that it is no longer a victim of China’s Nibble and Negotiate policy and will now onwards review the terms of the engagement on own terms. China’s market in India may have generated just $5.8 million in revenue for the year ended 2018-19, but with the rapid acceptance of users more recently, the stakes seem to be rising. According to a Reuters report, when Tik Tok was briefly banned last year in India on the grounds that it was allegedly promoting pornography, the company had told a local court that it was losing around $15 million a month because of the ban. Eventually, the App was permitted to operate.

The ban affects China big time since the potential loss of advertising revenue impacts app-makers. Tik Tok’s parent ByteDance Ltd. recorded a doubling of global revenue to $17 billion in 2019, over the previous year, with $3 billion in profit. Its India business may have yielded only $5.8 million in revenue for the year ended March 2019, but with quicker user adoption more recently, the stakes seem to be getting higher. China is India’s largest trade partner after the US and our dependence on China extends well beyond the tech space. The app ban will certainly have an impact on the holding companies. For example, when it comes to Tok-tok, 30% of total installations come from India and this naturally harms its parent company ByteDance. The impact on China’s economy overall is difficult to predict at this stage, but will undoubtedly be negative.

The next question which comes to mind is how will the ban on the Chinese Apps be enforced. As soon as the Google (Android) and Apple receive copies of the government order, the banned apps will be removed from Google Play Store as well as iOS App Store. This essentially means that once the procedure is completed, these apps will become non-functional by default. Government officials are already in talks with Indian internet service providers (ISPs) and telecom service providers (TSPs) to block all data traffic with these apps. This means that once the procedure is completed, these apps will become non-functional by default. Although it is not illegal if you do not delete the app, there will be no further developer support and updates for the banned apps. The internet access will be blocked on all Indian networks due to cybersecurity threats, so the apps will become inoperable.

China’s response to the banning of its apps by India has been kind of muted. China has stated that it suspects India’s actions are in violation of the World Trade Organization (WTO) rules. In a statement, the Chinese Embassy in New Delhi said, “India’s measure selectively and discriminatorily aims at certain Chinese apps on ambiguous and far-fetched grounds, runs against fair and transparent procedure requirements, abuses national security exceptions, and [is suspected] of violating the WTO rules. It also goes against the general trend of international trade and e-commerce, and is not conducive to consumer interests and the market competition in India.” Simultaneously China also issued a statement that though the ban would hurt commercial interests of some Chinese companies but India is in no position to "cause harm to China's juggernaut economy". China says that the move to ban Chinese Apps is more political than anything else and blamed the Indian Government for failing to "rein in the rising nationalism" among Indians and instead encouraged the boycott to escalate. The ban effectively counters China’s efforts to become a tech giant. The banned apps have a large user base in India. This move will also urge other nations to look into the matter of data security and this in turn will have a deep impact on China. Indian start-up’s and other established companies will stand to greatly benefit in gaining user base. This will result in downloads of many more Indian apps and would thus promote our Prime Minister's effort of going vocal for local. People have already started using Indian alternatives for the banned Chinese apps and are quite happy with the performance.