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ICS Analysis

China’s Recent Tech Regulatory Measures

China’s recent regulatory measures related to large technology-led companies have raised questions about its future economic growth trajectory and relations between the Government and the private sector. The measures pertain to diverse industry sectors, aiming at different objectives such as national security, data protection, changing undesired consumer behaviours, and curbing monopolies, among others. Over the longer run, the Chinese measures are aimed in part at reforming and strengthening the tech sector which would have a salutary impact on business operations, corporate governance and customer confidence accompanied by a deleterious impact on innovation and normal entrepreneurial activity. With more sectors coming under the purview of stricter state regulatory actions, the goal of ‘common prosperity’ assumes overtones of curtailing unbridled wealth growth  rather than raising incomes to achieve inclusivity. The implications for Indian industry – both positive and negative - would play out in equity and financial markets as well as its startup sector, and the global ripples might impact its economic resilience.

 

Keywords: China, technology, China Regulatory Changes, Common Prosperity

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