Hope everyone had a nice and relaxing weekend (but honestly was the weekend really any different than weekdays?). I spent the weekend on this new project management called clubhouse.io that everyone has been raving about (😉).
Talking about audio, Ankit (https://twitter.com/ankitkr0) and I released our first podcast episode- https://anchor.fm/anmol-maini/episodes/Episode-1-ed05a4 (We’re still working on the format and content to expect us to experiment with this over the next couple of weeks).
Coming to the day’s news, eCommerce is unfortunately not coming back soon as we initially thought and seems like Chinese investment into the country is going be restricted.
➡️ Yesterday the Ministry of Home Affairs came out with an order that states it was revoking a clause that originally let eCommerce companies & their vehicles operate.
➡️ It sounds like eCommerce will continue to be restricted to “essential” items, which currently include groceries, health & sanitary products and medical supplies.
➡️ But is it really fair that the government gets to decide what is essential and what is not? Items that might be essential to a group of individuals might not be seen that way by others.
➡️ For example, a new wireless router may not be considered “essential”, but if someone’s current router stops working and it affects them being able to do their job would it be fine for them to somehow procure that item?
➡️ Maybe in the next couple of weeks once the “green zones” are finally determined, non-essential eCommerce, in those areas, will be allowed to be resumed.
➡️ In an interesting move, India decided to amend it’s FDI policy to require neighboring countries to seek approval for foreign investments into the country.
➡️ As China contributes most significantly to FDI into the country of all the neighbors (Pakistan, Afghanistan, Nepal, Bhutan & Myanmar) so it is quite evident that this policy was targeted towards them.
➡️ So how does this affect Indian startups? Well over the years, there has been a bunch of Venture funding from Chinese companies (Alibaba, Tencent, Xiaomi) as well VCs from China (Legend, Fosun RZ Capital, Morningside) that have invested billions of dollars in Indian startups, including the likes of Paytm, Flipkart & ShareChat.
➡️ With future deals possibly being under the government’s eye, there might be a reluctance from Chinese VCs to continue operations in India if the time spent on deals is no longer worth it with the added scrutiny and regulations.
➡️ This seems like it will definitely impact late stage funding in India at least in the short-term but maybe (just maybe), it opens the doors for more US VCs/PE firms to India a closer look.
Feedback & ❤️ always appreciated
More tomorrow :) BONUS (Tweet of the day): https://twitter.com/kushalbhagia/status/1251759951208263681