India's Rise as a Web3 Leader: Key Insights

Published at: August 12, 2024

India to Lead Web3, Say Experts


India has long been a land of tech expertise; at the same time, with more than 750 million internet users recorded in January 2024, it formed the country's booming IT sector that made up 7.5 percent of its nearly $3.9 trillion economy in 2023.

In digital competitiveness, with a score of 60, India leads all but one country in the BRICS group and can well be counted as an IT leader globally. This good base will bring India to a great capacity in supporting the upcoming Web3 and blockchain sectors.

Web3 Boom in India:


The surprise, though not a surprise, will be the rapidity of India's rise in the Web3 space. It already hosts more than 1,000 startups working on Web3 and blockchain technologies. Some experts have gone on to predict that India's Web3 market could be worth more than $1 billion by 2032.

Here is how Sanjay Saxena, co-founder and CEO of CIFDAQ, an AI-driven blockchain network, explains that India's young population is an underlying driver of this growth. The share of global web3 developers from India has grown from 3% in 2018 to 12% in 2023.

"India is developing a new generation of tech-savvy individuals. So, its developers are in their early 20s with fresh energy towards web3 development," mentioned Saxena.

Education Leading the Way:


Leading educational institutions in India, such as the Indian Institutes of Technology and the National Institutes of Technology, have been nowhere behind in introducing curricula on new-age technologies and have started with studies on blockchain and other web-related subjects as early as 2018.

Such initiatives have helped in preparing a workforce capable of taking on the challenges of the decentralised future, Saxena reckons.

Government Support:


The Indian government is also quite willing to adopt blockchain technology. This can be witnessed in projects such as the Central Bank Digital Currency, which is working on creating a blockchain alternative to the Indian rupee, and the push by the Ministry of Electronics and Information Technology to come up with a unified blockchain framework.

Saxena added that over 50% of Indian states are already working on different blockchain projects. For instance, the Tamil Nadu Blockchain Backbone aims at securing important documents and data, while the West Bengal NFT-based land mutation programme was the first to create 50,000 NFTs representing one million property records.

Participation by the Private Sector:


The Indian private sector is also aggressively taking up blockchain. Tech Mahindra is one of the top private IT companies with a global footprint and recently announced a "Stablecoin-as-a-Service" solution that would help financial institutions around the world in the smooth and secure conduct of digital transactions. Another one of India's biggest conglomerates, Reliance, has also been reportedly experimenting with the technology in its supply chain processes.

The second IT giant, Infosys, has developed blockchain-based applications for commercial banks and insurers alike, which aid them in the smooth execution of operations and in cutting down on fraud.

Challenges Ahead: Although there has been good progress, there are sidelines that still need to be seen in the web3 sector in India, and in particular that of the regulation. The Indian government is still working on clear rules that can be helpful in the growth of blockchain technologies.

There are still unclear tax laws, rendering operational challenges for a great number of startups in Web 3. According to Saxena, such tax challenges are creating a brain drain, wherein many virtual digital asset businesses and professionals are moving to countries providing more favourable regulations.

"This migration not only leads to a brain drain but diminishes India's potential to become a Rs 30 trillion digital hub," he cautioned.

To counter this, Saxena envisions that the government should incentivise with tax breaks and work to develop infrastructure at the very highest level. He believes the availability of a talented labour force combined with a very strong ecosystem, beneficial demographics, educational initiatives, government support, innovation, and community drive make India a very strong contender to lead in the web3 space.

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Shubham Sahu
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