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India market and business update: May 2024

23 May 2024

This month's business update focuses on the rapidly growing technology sector in India. Through pioneering technologies, the expansion of Digital Stack exports to the Global South and India's large Web3 ecosystem, India distinguishes itself as a beacon of innovation and opportunity. 

The Deloitte technology trends 2024: India perspective report, published in April 2024, records that India's technology industry showed resilience and substantial growth over the last two years, despite a challenging global environment. Revenue from this industry (including hardware) is estimated to reach US$254 billion in FY2024, a significant increase from US$9 billion the previous year. Exports are also estimated to reach around US$200 billion and the domestic technology sector expected to surpass US$54 billion.

The Deloitte report discusses the cutting-edge technologies embraced by forward-thinking organisations operating in India and how these are used throughout various sectors. The report provides useful perspectives into "potential industry game changers" for Indian business leaders and organisations, Government initiatives that support the technological evolution, and regulatory considerations.

Digital Public Infrastructure (DPI) and Digital Public Goods (DPG)

India has developed its digital infrastructure, made up of a range of DPI and DPG platforms, to create what is known as the Indian Stack. The DPI Approach: A Playbook states that DPI is a set of shared digital systems developed to provide equitable access to public and private services at societal scale. Meanwhile, it describes DPG as open-source software, open data and content that complies with privacy and other applicable laws and helps reach sustainable development goals. The Government is set to extend the reach of the Indian Stack exports to the rest of the Global South by including new innovative platforms to help emerging market economies in several social aspects such as financial accessibility and inclusion, technological developments and driving economic growth.

The independent global think-tank, Observer Research Foundation, predicts that there are going to be major changes to global finance with technological advancements leading to significant developments to traditional systems. The Indian Stack has allowed India to get ahead in this area, overtaking some developed countries.

India has been able to facilitate the exportation of its innovative digital initiatives by collaborating with international organisations such as the UN and G20. New DPI and DPG include Samarth, a Ministry of Education initiative, aiming to provide education institutions across the country with a digital framework to plan, manage, deliver and monitor services for students and staff, and Agami, a platform to improve the law and justice system.

Web3 Ecosystem

In an article by Amazon Web Services, Web3 is described as a term for technologies that decentralise data ownership and control on the internet. Web3 technologies have mechanisms that allow for community-driven projects, where user interaction is automatically regulated. In these projects, end users have an increased substantial say, enabling them to control data and determine pricing which directly contribute to technical development. Given their set-up, Web3 technologies reduce the risk of privacy issues such as data abuse compared to existing Web2 companies.

India is a major player in global Web3 ecosystems with over 1,000 start-ups and an increased share of the global pool of Web3 developers. This amounts to 12% of global Web3 developers in 2023 compared to 3% in 2018, according to the second edition of Hashed Emergent's report, 'India's Web3 Landscape 2023'. The report also states that the sector received US$250 million of investments in Web3 start-ups in 2023.

The popularity of Web3 is evidenced by the involvement of major companies like Eros in the ecosystem. KPMG India Head of Web3 Krishna Tyagi states that the expanding integration of Web3 and block chain technology across various industries offers a substantial global opportunity for Indian tech experts and enterprises alike.

The growth of India's innovation, digitisation and technological landscape is reshaping traditional systems and "steering India towards a dynamic FY25", according to Partner & Technology Sector Leader of Grant Thornton Bharat, Raja Lahiri.

DWF is a leading legal adviser to Indian and India-focused companies, financial institutions and high net worth individuals and families. Our India Group, consisting of over 93 lawyers from 9 countries, 15 practice areas and 9 sector groups, is one of the largest India groups of any international law firm.  With decades of extensive expertise in guiding Indian clients in respect of outbound legal work, our team of experts and specialists empower both India-focused and India-based clients to achieve their strategic objectives.  If you have queries on any of the issues covered in this article, please contact one of our experts. 

We would like to thank Narissa Pankhania and Oliver Coletta for contributing to this article.

Further Reading