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Chinese Capital May Be Replaceable, But Not Their Expertise, Says SoftBank’s Rajeev Misra

Chinese Capital May Be Replaceable, But Not Their Expertise, Says SoftBank’s Rajeev Misra

Misra estimates $10-15 Bn financial setback for startups due to new policies to curb Chinese investment in India

As per GlobalData, Chinese Investment in Indian startups have grown by 12 times to $4.6 Bn in 2019

Misra believes technological supremacy is the next frontier of strength

Softbank’s top executive Rajeev Misra has highlighted that Chinese capital comes with a lot of expertise on business, and the Indian startups will be missing this input following the Indian government’s move to curb Chinese investments.

Speaking at the ET Global Business Summit on Thursday (September 25), Misra pegged nearly $10-15 Bn financial setback for the startups as the Indian government has set up a screening process for all investments coming in from neighbouring countries, mainly China.

However, he also noted that the capital will soon be replaced by others in a market flooded with liquidity, but Chinese investors also offered a level of expertise in order to scale businesses. Citing Alibaba and Paytm deal, Misra added that this was more like a strategic partnership and not a financial investment.

Similarly, companies across various fledgling sectors like food delivery and ride-hailing have benefited courtesy the knowledge they gained from their Chinese investors, he said.

“A few billion dollars… $10-15 billion of financial capital will be replaced, it is the technical knowledge that a ride-sharing co can get from a Chinese ride-sharing (firm) which will be missed. Right or wrong is not for you and me to discuss,” he said.

According to data and analytics firm GlobalData, Chinese Investment in Indian startups have grown by 12 times from $381 Mn in 2016 to $4.6 Bn in 2019. Overall, 17 Indian unicorns today have Chinese investors on their board. Here’s a table to showcase the lead Chinese investors on board of Indian unicorns.

Misra also noted that establishing technological supremacy is the next frontier of strength which will also have an impact on the gross domestic product (GDP) growth because of its importance in areas like genome mapping, medical technology and chin design on economic activities.

“The next frontier in the world for any show of strength or a form of cold war will be fought in the battleground of technological supremacy for the next 10 years… Countries and nations will want to become self-sufficient in technology, and that is where the power will come from,” he said.

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