India has been one of the hotspots of investments from China, but that might end now the hostilities between both countries increase, says business analyst Shaun Rein to AP. Chinese apps have already been banned by the Indian government, and startups seem to be next. Anti-Chinese feelings among consumers might be putting Chinese investors also off.
The antagonisms carry risks for India: A broader boycott could backfire if China were to retaliate by banning exports of raw materials used by India’s pharmaceutical industry. So far, it has not.
In the longer term, Chinese companies might avoid investing in India’s technology sector and Indian start-ups might be reluctant to accept Chinese investments for fear of repercussions, said Shaun Rein, managing director of market intelligence firm China Market Research Group.
“Chinese investors are going to become very wary of investing in India. They’ll be worried that they might invest billions of dollars into the country and either Indian consumers will boycott and protest against them, or the government will just ban them because they’re backed by Chinese,” Rein said.
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