Following Investments from Intel, Facebook, Google CEO Sundar Pichai Announces $10 Billion Fund to Accelerate India’s Digital Economy

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Alphabet and Google CEO Sundar Pichai on 13 July 2020; addressed the sixth annual edition of “Google for India” virtual event and announced a huge digitisation fund. In fact, Google will invest $10 billion (Rs 75,000 crore) in India over the next five to seven years. Earlier that day Prime Minister Narendra Modi held a discussion with Pichai “on a wide range of subjects“. The Prime Minister also discussed the challenges of global pandemic and the new work culture with the top business leader.

“Today, I’m excited to announce the Google for India Digitization Fund. Through this effort, we will invest Rs 75,000 crore, or approximately $10 billion, into India over the next 5-7 years. We’ll do this through a mix of equity investments, partnerships, and operational, infrastructure and ecosystem investments. This is a reflection of our confidence in the future of India and its digital economy,” –

Sundar Pichai’s statement.

Additionally, Sundar thanked Prime Minister Modi for implementing his vision of Digital India. He also highlighted how the country has made huge progress in getting a billion Indians online. Consequently, Pichai praised how low-cost smartphones combined with affordable data, and a world-class telecom infrastructure have paved the way for new opportunities.

Statements by the Indian-American Pichai

Pichai recalled how when he was young, every new piece of technology brought new opportunities to learn and grow; and how he always had to wait for it to arrive from some place else. He said, “Today, people in India no longer have to wait for technology to come to you. A whole new generation of technologies are happening in India first.

Just four years ago, only one-third of all small businesses in India had an online presence. Today, 26 million SMBs are now discoverable on Search and Maps, driving connections with more than 150 million users every month. What’s more, small merchants across the country are now equipped to accept digital payments,”

Pichai added.

Notably, Union Minister Ravi Shankar Prasad also welcomed Google’s move to accelerate India’s digital economy. 

Areas of Investment

Investments will focus on four areas important to India’s digitization. 

  • First, enabling affordable access and information for every Indian in their own language, whether it’s Hindi, Tamil, Punjabi or any other language. 
  • Second, building new products and services that are tailor-made for India’s unique needs. 
  • Third, empowering businesses as they continue or embark on their digital transformation. 
  • Fourth, leveraging technology and AI for the social good, in areas like health, education, and agriculture.

“As we make these investments, we look forward to working alongside Prime Minister Modi and the Indian government; as well as Indian businesses of all sizes to realize our shared vision for a Digital India”,

Sundar Pichai in his statement

Is Google aiding India or just keeping up with its competition?

With Instagram and WhatsApp under its umbrella, Facebook is used by 800 million people of India.

In April of 2020, Facebook announced an investment of $5.7 billion, or INR 43,574 crore in Jio Platforms Limited, of our giant Reliance Industries. Facebook announced it vide a press release on April 21, 2020. With this investment, it became the largest minority shareholder in Jio Platforms Limited. Additionally, with Instagram and WhatsApp under its umbrella, Facebook is used by 800 million people of India.

Thereafter, by May 2020, Jio had received investments amounting to a whopping $10 billion. Also, as per Hindustan Times article published on June 4, 2020, the investments were from Facebook and money from private equity firms Silver Lake, Vista Equity Partners, General Atlantic and KKR & Co Inc.

As a matter of fact, due to these investments, Jio recently launched JioMeet. Thus, competing with GoogleMeet and Zoom; during this pandemic, when almost everything is being done by video-conferences. Subsequently, United States public multinational corporation Qualcomm invested Rs. 730 Crores in Jio; whereas, Intel invested invest Rs 1894.50 crore for 0.39 per cent stake in Jio Platforms. Notably, RIL had its Annual General Meeting on July 15, 2020.

India’s Significance

India, being a country with over 17.7% of the total world population, holds importance for these Companies. Thus, it isn’t surprising that Facebook, Intel and Qualcomm all put their eggs in Ambani’s basket, possibly anticipating Jio taking over all its competition in the country.

In the backdrop of these developments, Google announced its investment in India. The announcements were made vide a press release, Investing in India’s digital future. Thereafter, on July 15, 2020, Google signed an agreement to invest $4.5 billion (INR 33,737 crore) in Jio Platforms Ltd, taking a 7.73 percent stake in the company, pending regulatory review in India. This is the first investment from the Google For India Digitization Fund announced earlier this week, which aims to accelerate India’s digital economy over the next five to seven years through a mix of equity investments, partnerships, and operational, infrastructure and ecosystem investments. 

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Ishan Harlalka
Ishan Harlalkahttp://lexinsider.com
I am a 3rd year law aspirant pursuing BA LLB. I am deeply interested in learning and am always looking forward to gain knowledge about new subjects. In my leisure time, I try to read books of various genres and by different authors. As people from non-law background may find it difficult to understand legal provisions and jargons, I try to write in a way that my articles are easy to comprehend and after reading them, one can discuss them with others.

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