FLIPKART and Ola, two of India’s biggest tech successes, have urged the government to make it easier for domestic start-ups to see off competition from well-heeled foreign rivals.
Speaking at the Carnegie India Global Technology Summit in Bangalore both Flipkart executive chairman Sachin Bansal and Ola CEO Bhavish Aggarwal claimed they were faced with an uneven playing field because foreign firms are able to raise cash more easily.
In what appears to be a coordinated push, they seemed to appeal for the Government to implement protectionist policies to give them an advantage in their respective battles with U.S. firms Amazon and Uber.
“What we need to do is what China did (15 years ago) and tell the world we need your capital, but we don’t need your companies,” Bansal told the audience, according to the Economic Times.
Aggarwal claimed that non-Indian companies are able to raise capital easily due to profitable markets abroad, which is then used to fund losses in India as they try to out-compete rivals.
“What’s happening in both our industries (is that) there is narrative of innovation that non-Indian companies espouse but the real fight is on capital, not innovation. The markets are being distorted by capital,” he said.
Flipkart & Ola – children of post-liberalization, who laughed at Taxi-drivers & retailers crying for protection https://t.co/lJnOw5YoqM
— Gabbbar (@GabbbarSingh) December 8, 2016
These scoundrels built copycat businesses to begin with, & are now begging the govt to protect them. Disgraceful. https://t.co/bBAioozutE
— Amit Varma (@amitvarma) December 8, 2016
These arguments may seem strange for two companies that could be seen as copycats of their American rivals and also both more 80 percent owned by overseas investors and the irony was not lost on Twitter users, as noted by The Financial Express.
But both companies are under pressure as they lose market share to their foreign rivals. According Business Standard, they are struggling to raise funds at valuations equal or higher than their last funding round.