Rapido Becomes Unicorn Amid Surge in India’s Space Tech Sector
India’s space technology sector has achieved a significant milestone, securing a record-breaking $126 million in funding for 2023. This marks a 7% increase from 2022 and an impressive 235% jump from 2021, as reported in the Tracxn Space Tech Geo Report 2024. The country’s space tech startup ecosystem is rapidly expanding, now featuring over 100 companies, the majority of which were founded in the past five years. This growth reflects India’s increasing presence in the global space technology arena and its commitment to innovation and development in this sector.
Meanwhile, Rapido, a ride-hailing startup, has joined the unicorn club after raising $120 million in fresh funding led by WestBridge Capital. The funding round propelled Rapido’s valuation to $1 billion, making it the third startup to achieve unicorn status in 2023, following Krutrim and Perfios. The startup ecosystem in India is witnessing renewed investment activity after a period of slowdown, with other companies like Zepto and Purplle also securing substantial funding earlier this year. This trend highlights the growing investor confidence in India’s burgeoning tech startups.
Editor’s Note: India’s space tech sector has seen a remarkable $126 million in funding for 2023, reflecting a 7% increase from the previous year and a 235% rise from 2021. Rapido, a ride-hailing startup, has achieved unicorn status with a $1 billion valuation following a $120 million funding round led by WestBridge Capital. This surge in investment underscores the growing confidence in India’s dynamic tech startup ecosystem.
Indian Startups Embrace Generative AI to Drive Innovation
Artificial intelligence is becoming a cornerstone of innovation for many of India’s leading startups across various sectors, including e-commerce and fintech. A recent report by EY reveals that about two-thirds of India’s top 50 unicorn startups are already leveraging AI or generative AI technology, showcasing their proactive approach to adopting these technologies compared to traditional players. Startups are utilizing AI for a range of applications beyond customer-facing chatbots, such as personalized recommendations, marketing, content generation, fraud detection, risk management, and payment solutions. “There is no poverty of ambition or talent in Indian startups trying to leverage AI,” said Rohit Pandharkar, AI partner at EY. While the scale and maturity of AI deployment in Indian startups are still evolving and lagging behind the US and China, Pandharkar believes this will improve as AI costs decrease.
According to Rajnil Mallik, partner and GenAI go-to-market leader at PwC, the distinction between AI and non-AI startups is blurring as more companies integrate AI into their operations. Indian startups have a talent pool advantage for AI adoption, but global startups often benefit from easier access to capital. In the fintech sector, Indian startups are particularly well-positioned due to the UPI revolution, which has opened new avenues for payment innovations. This shift highlights the growing role of AI as a ubiquitous part of the technological landscape, enabling Indian startups to stay competitive on the global stage.
Editor’s Note: Generative AI is increasingly driving innovation among India’s top startups, with two-thirds of the country’s leading unicorns adopting these technologies for diverse applications like personalized recommendations and fraud detection. Despite lagging behind in scale compared to global leaders, Indian startups are leveraging their AI talent and the UPI revolution to enhance competitiveness and transform their sectors.
India Maintains Stance on Chinese Investments Despite Economic Recommendations
India will not reconsider its current stance on allowing Chinese investments, according to Trade Minister Piyush Goyal. During a press briefing in New Delhi, Goyal stated, “There is no rethinking at present to support Chinese investments in the country.” This statement comes in response to suggestions made by Chief Economic Adviser V. Anantha Nageswaran in the government’s annual economic survey, which recommended focusing on direct investments from China to boost exports and manage India’s growing trade deficit with Beijing. Goyal emphasized that these economic survey recommendations are not binding on the government.
The Indian government heightened scrutiny on Chinese investments following border clashes in the Himalayas in 2020. Despite this, Finance Minister Nirmala Sitharaman has expressed support for Nageswaran’s suggestions to allow more Chinese investment. The Trade Minister’s remarks also follow a Reuters report indicating that India may consider easing restrictions on Chinese investments in non-sensitive sectors like solar panels and battery manufacturing. This potential shift highlights ongoing debates within the government regarding the balance between economic interests and national security concerns.
Editor’s Note: India will maintain its current stance on Chinese investments, with Trade Minister Piyush Goyal affirming that there are no plans to reconsider the existing restrictions. This stance contrasts with recommendations from Chief Economic Adviser V. Anantha Nageswaran, who suggested increasing direct Chinese investments to address trade deficits and boost exports. The debate continues within the government, balancing economic interests with national security concerns, despite Finance Minister Nirmala Sitharaman’s support for Nageswaran’s proposals.
WTO Delays Ruling on India-Taipei ICT Import Duty Dispute Until October
The World Trade Organization’s (WTO) dispute settlement body has agreed to delay the adoption of a ruling against India’s import duties on certain information and technology products until the end of October, following a joint request from India and Taiwan. The decision was made during a meeting of the dispute settlement body in Geneva on July 26, as both parties are engaged in mutual discussions to resolve the issue. “The DSB agreed to the latest requests from Taiwan and India,” stated a Geneva-based official. This request marks the fifth time India and Taiwan have sought additional time to consider the adoption of panel rulings concerning India’s tariffs on certain high-tech goods. The two sides requested the DSB to postpone the adoption of the panel reports until October 28, 2024, to facilitate a resolution.
The WTO’s dispute panel had ruled on April 17, 2023, that India’s import duties on specific information and technology products violated global trading norms. This ruling resulted from a case initiated by the European Union, Japan, and Taiwan against India in the WTO, which began in May 2019. The dispute concerns duties on electronic goods, including cellular network telephones and machines for data reception and transmission. India has argued that these products fall under the WTO’s Information Technology Agreement (ITA-2), to which it is not a signatory. India is part of ITA-1, signed in 1997, which did not require eliminating customs duties on these products. The WTO, a 164-member multilateral body, sets norms for global trade and resolves trade disputes among member countries.
Editor’s Note: The WTO has delayed the adoption of a ruling on India’s import duties for certain ICT products until late October, following a joint request from India and Taiwan. This marks the fifth request for an extension as both parties seek to resolve the dispute over India’s tariffs, which a WTO panel ruled on in April 2023 as violating global trading norms.
Taiwan’s Ahamani EV Invests in India’s Electric Vehicle Sector with New Battery Facility
Ahamani EV Technology Co., Ltd., a Taiwanese leader in electric two-wheelers and AIOT smart mobility, is set to invest in India’s burgeoning electric vehicle (EV) market by establishing a megawatt-scale battery manufacturing facility. The company is also seeking strategic technology transfer partnerships with major Indian automotive players. With over two decades of innovation in EVs, Ahamani brings expertise in battery technology, motor systems, and intelligent fleet management solutions. Its UrDa AIOT Mobility System, a cutting-edge platform for managing electric two-wheeler fleets, is renowned for its efficiency and data-driven insights.
India’s drive towards electric mobility, backed by favorable government policies and growing consumer demand for sustainable transportation, presents a significant opportunity for Ahamani. By setting up a local battery manufacturing plant, the company aims to enhance India’s self-reliance in the EV supply chain while boosting the domestic economy and job creation. Ahamani’s focus on technology transfer partnerships underscores its commitment to long-term collaboration with Indian industry leaders, fostering the sharing of knowledge, resources, and best practices. Tzu Chi Kung, Founder & CEO of Ahamani EV Technology, emphasized the potential of the Indian market and the company’s readiness to collaborate with Indian partners to accelerate EV adoption in the country. This investment and openness to partnerships reflect Ahamani’s confidence in India’s growth trajectory and commitment to the nation’s electrification goals.
Editor’s Note: Taiwan’s Ahamani EV Technology Co., Ltd. is investing in India’s electric vehicle sector by establishing a megawatt-scale battery manufacturing facility and pursuing strategic technology transfer partnerships with Indian automotive firms. With its extensive experience in EV technology, Ahamani aims to support India’s push for electric mobility, enhance local supply chain capabilities, and contribute to job creation. Founder & CEO Tzu Chi Kung highlighted the company’s enthusiasm for collaborating with Indian partners to accelerate EV adoption and drive growth in the sector.
No Ban on Import of Chinese and Taiwanese Electronic Items, Says Union Minister
Union Minister of State for Commerce and Industry Jitin Prasada clarified in Parliament on Friday that there is no specific prohibition on the import of Chinese and Taiwanese equipment and electronic items. This statement was in response to a query by DMK MP Kanimozhi N.V.N. Somu, who inquired whether the Indian government had imposed any bans on such imports used across various sectors in the country.
In response to further queries about the detailed list of Chinese and Taiwanese equipment and electronic items imported from China, the Union Minister stated that such a list is not maintained. Regarding the total value of imports from China and Taiwan over the past five years, Prasada directed to a portal where year-wise data on the overall import value from these countries is available, providing transparency and access to relevant trade information.
Editor’s Note: Union Minister Jitin Prasada confirmed in Parliament that there is no ban on importing Chinese and Taiwanese electronic items, clarifying that such equipment is not specifically prohibited. He also noted that while a detailed list of imported items is not maintained, data on the total value of imports from these countries is accessible through a dedicated portal.
MediaTek Expands R&D Investments in India to Capitalize on Growing EV Market
Taiwanese chipset manufacturer MediaTek plans to increase its research and development investments in India to tap into the country’s burgeoning electric vehicle (EV) market. MediaTek’s corporate vice president, Mike Chang, announced the company’s intention to enhance its R&D centers in Bangalore and Noida to focus on automotive chip design and software development. With India undergoing a significant shift in its automotive sector, MediaTek aims to leverage the country’s talent pool and supportive government policies to introduce advanced system-on-chip (SoC) solutions, utilizing Nvidia BlackWell GPUs for enhanced user experiences. MediaTek is actively engaging with Indian two- and four-wheeler manufacturers to implement “Made in India” IoT modules and infotainment systems for electric vehicles.
MediaTek has partnered with Jio Things, a subsidiary of Jio Platforms, to launch smart module devices tailored for the two-wheeler market. This collaboration aims to combine MediaTek’s hardware expertise with Jio’s software and 4G/5G capabilities to offer integrated solutions for EV manufacturers, including fleet management and customer engagement. By the end of the year, MediaTek’s chipsets are expected to be deployed in 11 new car models, capitalizing on its global partnerships with automotive OEMs. As the EV market in India grows, MediaTek intends to replicate its smartphone success in the automotive segment, with projections indicating the market will reach ₹10,000 crore by 2025. The company plans to incorporate generative AI in its automotive technology to enhance the human-machine interface and driving experience, aiming to make its solutions affordable and widely adopted in the Indian market.
Editor’s Note: MediaTek is expanding its R&D investments in India to capitalize on the rapidly growing electric vehicle market, focusing on automotive chip design and software development at its Bangalore and Noida centers. Partnering with Jio Things, MediaTek aims to integrate its chipsets with IoT modules and infotainment systems, enhancing EV solutions for the Indian market. By the end of the year, MediaTek plans to feature its chipsets in 11 new car models and incorporate generative AI to improve user experiences and drive affordability in the burgeoning EV sector.
Foxconn Plans to Expand India Operations with iPad Assembly at Tamil Nadu Facility
Foxconn is considering expanding its manufacturing operations in India to include the assembly of Apple iPads at its Sriperumbudur facility in Tamil Nadu, as reported by The Economic Times. Currently, Foxconn’s efforts in India focus primarily on producing iPhones. The potential shift to iPad assembly marks a significant expansion, as Apple seeks to diversify its manufacturing footprint beyond China. This move aligns with Apple’s strategy to broaden its product assembly locations, having already shifted some iPad production to Vietnam last year. Discussions with the Indian government regarding this expansion are reportedly underway, though starting MacBook assembly in India may take longer due to limited production volumes.
Industry sources indicate that the assembly of iPads in India is feasible, as the process is similar to that of assembling iPhones. The recent reduction in the Basic Customs Duty (BCD) on components from 20% to 15% is expected to accelerate Foxconn’s domestic manufacturing plans. Analyst Ashweej Aithal from Canalys noted that Apple initially hesitated to manufacture iPads and MacBooks in India due to past issues with government restrictions related to its partnership with BYD. These challenges were rooted in geopolitical concerns, but the current reduction in tariffs and policy changes may now facilitate Apple’s expansion in India’s growing electronics manufacturing sector. Meanwhile, Chinese electric car manufacturer BYD Auto Co has already begun assembling iPads in Vietnam, contributing to approximately 5-10% of global iPad assembly.
Editor’s Note: Foxconn is exploring the expansion of its operations in India to include the assembly of Apple iPads at its Tamil Nadu facility, marking a significant shift from its current focus on iPhone production. This move aligns with Apple’s strategy to diversify its manufacturing beyond China and is facilitated by recent reductions in import duties and policy changes, despite past challenges related to geopolitical concerns and government restrictions.
DPIIT to Propose Duty Inversion Correction in Electronics and Leather Goods
The Department for Promotion of Industrial Policy and Internal Trade (DPIIT) plans to recommend correcting duty inversion in electronics and leather goods during the upcoming customs duty review. DPIIT Secretary Rajesh Kumar Singh mentioned that the department is also considering a crackdown on tobacco companies’ proxy advertisements. He emphasized the government’s use of instruments such as Quality Control Orders (QCO) and import tariffs to influence investment decisions. The DPIIT aims to enhance domestic manufacturing and value addition, with a particular focus on expanding the component and vendor ecosystem to increase localization in sectors like electronics and mobiles.
In response to inquiries about foreign direct investment (FDI) and procedural changes, Singh stated that the government is working on standardizing procedures to streamline clearance processes. He clarified that current policies, like the Press Note 3, which allows Chinese investments through the government route, remain in place, and any potential changes are under internal discussion. The DPIIT is also reviewing public procurement norms, with some ministries considering increasing the percentage of minimum local content. Additionally, the department is consulting on extending simplified visa processes to Chinese professionals in non-PLI companies, reflecting a broader strategy to boost foreign investment while enhancing domestic production capabilities.
Editor’s Note: The Department for Promotion of Industrial Policy and Internal Trade (DPIIT) is set to propose corrections to duty inversion issues in electronics and leather goods in its upcoming customs duty review, aiming to bolster domestic manufacturing and localization. DPIIT Secretary Rajesh Kumar Singh also indicated that the department is considering stricter regulations on tobacco advertisements and streamlining foreign direct investment procedures. Additionally, the DPIIT is evaluating public procurement norms and visa processes for Chinese professionals to enhance foreign investment and strengthen the local production ecosystem.