Following Indian Prime Minister Narendra Modi’s election in 2014, many had hoped that the leader would speed up market reforms in order to attract foreign capital and grow the economy. However, rampant political and social problems throughout the country have caused these reforms to materialize much more slowly than initially anticipated. Many are additionally uncertain on the state of India’s economy due to modest GDP growth and little manufacturing output. In order to combat these issues, Modi is now beginning to prioritize the modernization of India’s digital infrastructure. A digital revolution in the country could potentially boost education and consumption, and consequently contribute to economic growth.
Some are even predicting that India could become “the new China” for American Internet companies. During a meeting in Seattle on September 23, China’s president, Xi Jinping, did not waver in regards to his government’s tough Internet policies. Conversely, Narendra Modi expressed his interest in potential Internet growth as he met with tech experts from companies such as Microsoft, Google, and Facebook. India conducts more mobile searches on Google than any country besides the U.S. and there are 132 million Indian users on Facebook, also only second to the United States.
Two years ago it was difficult to imagine India rising as a digital nation. Its Internet penetration was modest, mobile phone networks were exceedingly slow, and smartphones weren’t nearly as common. Now, the app market is growing exponentially within the country. The messaging service WhatsApp was purchased by Facebook last year and is now the most popular app in India. It allows users to send text messages and make phone calls for free, which is a luxury in a place where many earn just a few dollars each day. Although there are still so many that have not connected with Facebook, the company is offering more basic versions of its services so that users with simpler phones and slower networks can still take advantage of what the company has to offer.
Facebook is now working under an umbrella initiative named “Internet.org” to offer a free package of its services, including news, job listings, and text-only versions of Messenger and its social network to those in the country who cannot afford a data plan. Still, Facebook is not the only company working to expand its presence in India. Google has formed a partnership with Intel and a local charity to send female tutors to thousands of villages to teach rural women about the Internet. These tutors will ride by bicycle, and so far 200 bikes have been sent equipped with solar-powered tablets and smartphones to make this a reality. Since it is difficult to make money in the country, Internet companies are attempting to get more people online first, then profit from them at a later time.
Access to Internet is not the only challenge that the country faces. Following its independence from Britain in 1947, literacy rose to 70%, but is still behind the projected average world literacy rate of 90%. Rural areas within the country tend to be more illiterate due to poor curricula, lack of resources, and poor teachers. This issue could in response be combatted with more computers and better broadband in the country. The Internet has proved to be a cost-effective and convenient way for students to become educated in the past, and if rural areas could be reached this could expand business opportunities in the future. Only about 20% of Indians have access to the Internet, but if education improved and they were able to gain access, this could create the potential for an increased Indian e-commerce market. Opportunities for growth in the Indian Internet market are now more present than ever, and big companies are expected to take advantage of them in the near future.