Chinese President Xi Jinping’s crusade against the nation’s tech sector is finally bearing the fruits. Venture capital investors are fleeing Chinese markets en masse. In the past few months, a megalomaniac Jinping has reined in the country’s top business houses, unleashing another round of punitive actions against those seeking enlistment on the USA’s stock exchanges. However, one’s loss is someone else’s gain and thus, India is seemingly making the most out of the mess spurred out of Jinping’s business-subverting actions in China.
As reported by Bloomberg, India has surpassed China in terms of the value of venture deals first time after the year 2013. The value of venture deals in India surged to $7.9 billion in July, while China investments plummeted to $4.8 billion, according to data compiled by research firm Preqin.
“Global investors are increasingly excited about the potential for Indian companies competing in India and in other markets around the world,” said Anis Uzzaman, chief executive officer and general partner at Pegasus Tech Ventures, based in San Jose, Calif.
Read More: As China cracks down on its Tech Sector, Investors bank big on India
India is the most attractive destination for venture investors flocking out of China. India’s startups are going public to fervent demand — food-delivery app Zomato Ltd. has soared about 75% since its debut eight days ago — signalling the opportunity for profit. The month of July witnessed a $3.6 billion boost by Flipkart as it prepares for a potential Initial Public Offer in 2022.
EduTech sector in India is also flourishing that recently witnessed a spree of punitive actions in China, prompting the Chinese billionaires to go millionaires in a matter of just a few weeks. Being a market of 1.3 billion, India accounts as a preferable alternative for all the investors fleeing Jinping’s megalomania back in China.
The Chinese Communist Party under Xi Jinping has tasked themselves to plunge the country back into the dark days of Mao’s China. Since last month China’s EduTech sector has become the next target of the megalomaniac autocratic leader who has been ravaging the Chinese economy to curb his own vulnerabilities. Larry Chen, the former school teacher who became one of the world’s richest people, has lost his billionaire status as China cracks down on its private education sector.
Read More: Jinping has reduced China’s EduTech billionaires to millionaires within weeks
The Chinese tech sector too, in the past few months, has witnessed a scathing clampdown of the Chinese authorities. For instance, Jack Ma was China’s richest man just 10 months ago, now he has been made to surrender all of his shares to the Chinese regulatory bodies. The Chinese tech sector has slumped by more than $1.2 trillion since February, and it is believed that the next 6 months could witness a clean sweep of China’s private sector from the Chinese economy altogether.
The state-sponsored slashing attack on the stock market is taking a massive toll upon the investors and is forcing them to look for some promising markets, not to mention, like India. The prospect of lucrative IPOs is driving capital into Indian tech companies, bridging the funding gap between Chinese startups. Ola, a ride-hailing business, announced last month that it had raised $500 million from a consortium of investors, including Temasek, the Singaporean sovereign wealth fund. As the crackdown continues in the coming months, more and more investors are expected to diversify their investments by slotting their money into the Indian shares.