Confederation of All India Traders (CAIT) has asked the Minister of Commerce and Industry Piyush Goyal to investigate Chinese investments into 141 Indian start-ups including Flipkart, Paytm, Ola, Swiggy, Zomato, Byju’s, Udaan, Practo, ShareChat, Oyo Rooms, DailyHunt, MX Player, GOQii, Quikr, MyGate and Hike. The traders’ body has called these investments “a strategic move of China to command Indian innovations & technology and other vital sectors in a clandestine manner”. It has further suggested that all overseas investments in futures should be ”through Government route” and not the “automatic route”.
CAIT has asked the government to investigate the following aspects of Chinese investments into the 141 Indian start-ups:
- Level of Chinese investment control ration in Indian companies
- Location of data collected by these companies (India or abroad) and the security and safety precautions taken to store data
- Use of Chinese technology by these companies, and if yes, the extent of such usage
- Whether the Chinese technology used by the start-ups has any “inbuilt spying technology”
A number of these start-ups are backed by prominent Chinese investors such as Tencent (Flipkart, MyGate, Byju’s, Udaan, Practo, Policybazaar, Gaana, MX Player, Hike), Alibaba (Paytm, Snapdeal), Ant Financial (Zomato, Paytm), and Alibaba Capital (Bigbasket). Embattled TikTok owner ByteDance also has a 16.8% stake in news aggregator Dailyhunt.
The traders’ body has alleged that China engages in espionage through a number of tactics including cyber spying, signal intelligence, and monitoring dissidents. Citing “information in the public domain”, it has also alleged that China uses Chinese intelligence services, state-owned enterprises, private companies, graduate students and researchers for “stealing innovation” and “going after cost and pricing information, internal strategy documents”.
Calling it a “planned strategy” to acquire “vital data of Indian people” and an “exercise” to dominate Indian economic centres, CAIT has asked the government to investigate the business models of such companies and to put information about “any Chinese investment in any Indian venture” in the public domain.
The complete list of 141 start-ups as shared by CAIT is available here.