Hello, I am Priyanka Salve, CNBC’s senior correspondent for India, writing from Singapore. This week, I look at how India’s thriving digital ecosystem is attracting investments from Big Tech companies — the country’s digital userbase and talent pool are playing a key role.
INDIA – 2025/05/13: In this photo illustration, a Meta logo is seen displayed on a smartphone with a Google logo in the background.
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This report is from this week’s edition of CNBC’s “Inside India” newsletter. Like what you see? You can subscribe here.
The big story
When Rinchen Wangdi Bhutia in 2016 moved from the hilly northeastern Indian state of Sikkim to Kolkata, one of the country’s metro cities, he was just a face in a crowd.
Bhutia quit his corporate life and started a cloud kitchen in 2023. A year later, he started posting short videos of his simple home-made meals. Strangers turned to followers and views into food orders. Success followed.
Today, he runs two restaurants, specializing in dumplings, in Kolkata. He has more than half a million followers, and his reels regularly notch a million-plus views.
The country has the highest number of users across social media platforms such as Facebook (350 million-plus), Instagram (413.8 million) and video app YouTube (over 467 million), according to data from Statista. Messaging app WhatsApp reportedly has over 500 million users in India.
OpenAI chief executive Sam Altman in February said India was the company’s second-largest market.
Bhutia is part of India’s digital growth story that is creating entrepreneurs, drawing investments, and attracting global tech giants, fueled in large part by a gigantic talent pool and tech userbase.
“India is a big center for key talent – from chip design to AI, so the tech companies want to invest and locate there to take advantage of a key resource,” said Bhaskar Chakravorti, dean of Global Business at The Fletcher School, Tufts University.
Between 2023 and 2025 so far Amazon, Google, Microsoft, Meta, Apple, and their peers have funneled tens of billions into India.
On Monday, Bloomberg reported that ChatGPT-maker OpenAI was looking for local partners to build a data center in India with at least 1-gigawatt capacity. This comes just a week after the company launched its cheapest subscription plan, priced at 399 rupees ($4.57) a month, in India.
“User acquisition in Western markets is plateauing, while, by contrast, India offers a demographic bulge of first-time users and a reservoir of talent that can build, test, and iterate at scale,” says Vivek Agarwal Global Policy Expert, Country Director-India at Tony Blair Institute for Global Change.
Google and Meta on Friday announced new partnerships with Reliance Industries as the Indian conglomerate seeks to accelerate its push into artificial intelligence.
“We are excited to put AI into the hands of more people and businesses so they can do extraordinary things,” Google CEO Sundar Pichai said, adding that India was home to “some of the world’s most dynamic businesses, a thriving start-up ecosystem, and incredible amounts of creativity and ambition.”
A study conducted by Tufts University ranks India eighth among 125 countries on its digital evolution momentum index. The Index is a data-driven evaluation of the progress of the digital economy over a sixteen-year period (2008 – 2023).
Showcasing the country’s digital growth is India’s Unified Payment Interface or UPI, which powers instant, low-cost, mobile-based payments in India, handling about 640 million transactions every day. It came into being just nine years ago. Google Pay and Walmart-owned PhonePe, which use the UPI infrastructure, are among the dominant payment providers in India, according to data from the National Payments Corporation of India.
Numbers vs. growth
Meta-owned WhatsApp, which also provides payment services, has struggled to make a breakthrough in the hyper-competitive digital payments space, despite the messaging app’s over 500-million-strong user base.
“Scale on paper does not equal scale in practice,” said Sanchit Vir Gogia, Chief Analyst & CEO, Greyhound Research.
Meta even acquired a 9.9% stake in Jio Platform, Reliance Industries’ digital services arm, in 2020, for $5.7 billion. “By bringing together JioMart, Jio’s small business initiative, with the power of WhatsApp, we can enable people to connect with businesses, shop and ultimately purchase products in a seamless mobile experience,” Meta said while announcing the deal.
A strong local partner in Jio, which has a telecom subscriber base of over 500 million, could not help Meta make WhatsApp Pay a success in India. “The JioMart integration faltered, partly because Reliance Retail itself has not scaled as rapidly as promised,” says Gogia.
NPCI data for July shows that WhatsApp had just 74 million transactions compared with Google Pay’s nearly 7 billion transactions.
But this hasn’t stopped U.S. tech majors from investing more in India, including Meta.
“India is becoming the proving ground where Big Tech’s longer-term wagers are starting to yield visible dividends,” said Agarwal.
India’s talent pool has also led to large foreign corporations setting up their global capability centers in the country. India accounts for more than 50% of GCCs worldwide, with more than 1,600 up and running centers, according to U.S.-based GCC consultancy ANSR.
These centers offer further incentives to tech companies looking for enterprise customers. The growth of GCCs in India makes it a “great place to deploy tech applications and serve a wide range of MNCs out of India,” said Tufts’ Chakravorti.
Top TV picks on CNBC
BDO India partner for Indirect Taxes, Maulik Manakiwala, says the latest GST rate cuts will fuel consumer spending and free up income for big-ticket buys.
Polka Mishra of Javelin Wealth Management says the direction of travel in global trade is moving away from the U.S. She also sees increasing corporate partnerships between China and India building.
Neil Shah, vice president of research and co-founder of Counterpoint Research, discusses India’s ambitions in the semiconductor industry and the developments at SEMICON India 2025.
Need to know
Tax structure overhaul. The Indian government’s move on Wednesday to formally reduce the goods and services tax on a variety of items is expected to spur consumption and ease the impact of U.S. tariffs.
Elephant-dragon tango. India’s Prime Minister Narendra Modi met China’s President Xi Jinping at the 5th Shanghai Cooperation Organization summit, signaling improving ties.
Economy turbocharged. India’s economy grew at a faster-than-expected annual rate of 7.8% in the quarter to the end of June, boosted by the manufacturing, construction and service sectors.
– Vinay Dwivedi
Quote of the week
We’re very positive on non-banking financial companies, both on the lending and the non lending side … we are more positive on non-lending, non-banking, financial companies, that is where we feel a huge alpha can be created over the next three to five years, as the capital market penetration deepens and the household exposure to equities go up.
— Gautam Duggad, director and head of research at Motilal Oswal Financial Services
In the markets
India’s Nifty 50 index closed marginally higher at 24,734, giving up most of its 1% gains during the day on the back of an overhaul in its goods and services tax. The index has gained 4.6% so far this year.
The benchmark 10-year Indian government bond yield ticked down to 6.5%.
Coming up
Sept. 5: Foreign exchange reserves data
Each weekday, CNBC’s “Inside India” news show gives you news and market commentary on the emerging powerhouse businesses, and the people behind its rise. Livestream the show on YouTube and catch highlights here.
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