Online Quiz Test

The conflict between Indian start-ups and Big Tech

GS 3 Indian Economy & Related Issues

In Context

  • The Internet and Mobile Association of India (IAMAI) and some Indian start-ups are becoming more and more at odds with each other.

IAMAI’s opposition to the new law for tackling Big Tech firms:

  • About
  •  The Internet and Mobile Association of India (IAMAI) didn’t like how the Parliamentary Standing Committee on Finance wanted to make a new law to stop Big Tech companies from doing things that hurt competition.
  • What were these recommendations?
  • The panel suggested using ex-ante regulations, which protect consumers by mandating companies adhere to certain standards of behavior, to reduce anti-competitive practices in digital markets, as opposed to post-ante regulations, which can only punish an entiry after it has breached a law.
  • There were also calls for the creation of a new digital competition law and the designation of Big Tech companies as “systemically important digital intermediaries,” which would subject them to additional regulations.
  • In addition, it requested that digital market participants stop engaging in promotional methods such as “anti-steering,” “deep discounting,” “self preferencing,” “search & ranking preferencing,” and “other promotional practices that lead consumers to go for these companies.”


About Internet and Mobile Association of India (IAMAI):


  • In India, the interests of the online and mobile value-added services business are represented by the Internet and Mobile Association of India (IAMAI), a non-profit trade group.
  • The 1860 Societies Registration Act mandated its official registration.


  • In addition to advocating for the growth and development of the online and mobile value-added services industries, IAMAI also informs customers, stockholders, investors, and the government of India about the issues and needs of its member companies.
  •  The Internet and Mobile Association of India’s primary goal is to increase the quality and availability of value-added services related to mobile phones and the internet.

IAMAI’s concern

  • In its report, the industry group IAMAI said it was worried that the recommendations in the Report of the Parliamentary Standing Committee on Finance are neither targeted nor proportional. It also said that these recommendations would “stifle innovation.”
  • The AMAI said, “Lack of a well-articulated policy objective and failure to use an evidence-based approach to determine the need for the regulation have led to ambiguous, broad recommendations (in the report) that will stifle innovation, competition, and the benefits that accrue to markets and users.”

Similar concern as Big Techs

  •  IAMAI’s views were similar to those made by the Asia Internet Coalition (AIC), an industry group whose members include big tech companies like Meta, Apple, Amazon, Twitter, and Google.


Criticisms by the start-ups :

“Pro-Indian” start-ups vs “Pro-foreign” big techs

  • Some prominent Indian start-up founders sharply criticized IAMAI’s submission, accusing the industry group of advancing the viewpoints of large technology companies.
  • It has been criticized for “repeating and promoting anti-Indian and pro-foreign Big Tech viewpoints.”
  • Few others noted, “Start-ups strongly support a robust anti-monopoly Digital Act.” IAMAI is a failing lobby for propaganda and misinformation from BigTech. Etc.

Previous criticisms

  • This is not the first time that startups have criticized IAMAI’s stances on crucial policy issues.
  •  Earlier this year, a number of online gaming companies that are also members of the IAMAI wrote to the Ministry of Electronics and IT (MeitY) in opposition to the industry body’s submission on draft online gaming rules, arguing that the scoping of the rules was “poorly done” and that certain aspects required a “major re-write.”


Start-up ecosystem in India:


·        India has the third largest startup ecosystem in the world; consistent annual growth of 12-15% is anticipated year-over-year.

·        The growth rate of the startup ecosystem increased to 15% year-over-year in 2018, while the number of incubators and accelerators grew by 11%.

·        Indian startups have subsequently raised substantial capital from a variety of international and domestic institutions.

Role of Women

  •  Significantly, the percentage of female entrepreneurs rose to 14% in 2021-22, up from 10% and 11% in the two preceding years (2021-22).

India’s startup city

·        According to the 2019 Startup Genome Project ranking, Bangalore is one of the world’s 20 prominent startup cities.

·        It is also one of the five fastest-growing startup cities.

Big techs of India

Who are they?

  • ‘Big Tech’ refers to a small number of large, globally significant technology corporations, such as Google, Facebook, Amazon, and Apple.The term is sometimes used to refer to Microsoft, IBM, and Alibaba, among other significant technology companies.

Presence in India

  •  They have developed specific strategies for India, adapting to the requirements of Indian markets and consumers.


  •  These businesses are lauded for their innovative products and services, which provide substantial benefits to consumers, businesses, and governments.


  • However, they are criticized for monopolizing the market and undermining democratic processes.


Daily Main Question

[Q] What is the ‘foreign versus local’ issue between Indian start-ups and large technology corporations? What does it mean to designate Big Tech companies as “systemically significant digital intermediaries”?