Chinese apps ban: More signal than substance

The government’s decision to ban 59 mobile applications which have their origins in or are linked to China may be taken more as an expression of intent than as a substantive action to hurt Chinese interests. It has significant value as a message, though it need not be exaggerated. The banned entities include the popular video sharing app TikTok, a mobile browser called UC Browser and a file sharing app called SHAREit. All these are widely used in India, and TikTok is especially a hit. A ban on them would cause some discomfort to those who are used to them, but no major harm. It might hurt China, but not to any great extent. The valuations of some companies might suffer because they are also based on the user base in India, but such losses also, like the value of the measure for India, need not be exaggerated.

The government has said that the action has been taken in the interest of data security and national sovereignty as there was confirmation that the apps are engaged in activities “prejudicial to sovereignty and integrity of India, defence of India, security of state and public order”. They had been reported for “stealing and surreptitiously transmitting users’ data in an unauthorised manner to servers which have locations outside India”. These are major concerns, but questions might be raised about the timing of the decision. The government would certainly have been aware of these activities before the conflict on the border. Similar concerns also exist about apps not linked to China. That is why the decision may be considered as a signal to China in the present situation. It is also a signal to the people of this country of the government’s readiness to take some action in a situation where more substantive actions are difficult or can only be the last option.

While China has termed the ban discriminatory and called for its reversal, the government has stoutly defended it, asserting that there will not be any compromise on data security and safety. It has also been called a ‘digital strike’ on China. The ban should be seen along with other steps like last month’s curbs on foreign direct investments (FDI) from neighbouring countries, new GeM procurement rules and the restrictions on participation of Chinese firms in some infrastructure projects. While all this may amount to a pushback against China, the reality of significant Chinese presence in many areas of the economy and the difficulty in eliminating it cannot be wished away. There is even a view that the ban on some apps may only be temporary.