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April 25, 2022

The UK and Europe are competing for India’s booming digital economy

The UK will face stiff competition from the European Union in its attempts to tap into India's booming tech economy.

By Afiq Fitri

A new ‘cyber statement’ was issued by the UK and India over the weekend, promising greater cooperation to fight online criminals. Prime Minister Boris Johnson visited India last week as the UK looks to agree a new post-Brexit trade deal and strengthen existing tech partnerships on the subcontinent. But it faces competition from the European Union, which also wants a bigger slice of India’s booming digital economy.

The UK and India recently announced a deeper partnership across multiple digital industries. (Photo by T. Narayan/Bloomberg via Getty Images)

The statement says the “rules-based international order must be upheld online, just as it is offline”. It continues: “India and the United Kingdom are concerned by the increased willingness of states and their proxies to undertake malicious cyber activities contrary to identified norms of responsible state behaviour in cyberspace. We will deepen coordination on mitigation strategies against Advanced Persistent Threats as well as cooperation on tackling cybercrime.”

The recent announcement represents a deepened partnership between the two countries, rather than any significant break from the past. The first ‘cyber dialogue’ between the two countries took place a decade ago in New Delhi. And since at least 2020, key stakeholders in India and the UK across academia, government, and the private sector have been running “real-time, realistic” cyber crisis simulations to strengthen both countries’ cyber capacity building and reviewing existing practices.

India UK tech ties make sense as digital economy grows

In India, a highly skilled IT workforce coupled with strong government backing through the country’s ‘Digital India’ programme has led to phenomenal growth in recent years. During his trip, Prime Minister Johnson said the UK could try and tap into this workforce, relaxing immigration rules for Indians as part of a trade deal. “We have a massive shortage in the UK, not least in experts in IT and programmers,” he told reporters last week. “We’re short to the tune of hundreds of thousands in our economy. We need to have a professional approach, but it has to be controlled.”

When it comes to cybersecurity, the market in India has been projected to total almost $4bn in the next three years, while its e-commerce industries are expected to be worth up to $200bn by 2027. 

According to figures released by the country’s Data Security Council, revenues from cybersecurity products and services nearly doubled during the pandemic, from $5.04bn in 2019 to $9.85bn in 2021. Meanwhile, the country’s cybersecurity workforce also nearly doubled between 2019 and 2021, from 110,000 total employees to 218,000. 

But the UK is not India's only suitor. Trade talks between India and the EU have accelerated in the wake of the war in Ukraine, and earlier today in New Delhi, representatives from the European Commission and India announced the launch of the EU-India Trade and Technology Council.

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Modelled on the EU-US TTC, which was established last year, it will allow the two partners to “tackle challenges at the nexus of trade, trusted technology and security, and thus deepen cooperation in these fields”. The statement appeared to emphasise a more general partnership between the two digital economies, as cybersecurity issues did not feature prominently. 

Read more: India's depth of talent is its AI superpower

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