Parimatch Among International Investors Reducing Investment in India Due to Economic Constraints
In 2024, the Indian market will see the exit of Omidyar Network and WeWork Inc., while Parimatch continues to face significant restrictions on investing in the country. TWN’s report notes that these exits mirror those of major players like Disney, General Motors, Vodafone Group, and BYD, all of whom have struggled to maintain their strategies in India’s challenging business landscape.
Omidyar Network Halts Investments
Omidyar Network’s unexpected decision to cease new investments in India by 2024 surprised many observers. Having already invested over $600 million in startups such as 1MG, Vedantu, Kaleidofin, Kiwi, M2P Fintech, and Indifi, the foundation’s founder Pierre Omidyar cited only “significant changes in the context and economic landscape” without further explanation. Reports suggest that Omidyar and other Western investors face growing regulatory and political pressures in India.
Sharp Decline in Startup Funding
The departure of Omidyar Network coincided with a dramatic drop in startup financing. In 2023, investment plummeted by 62% to Rs 66,908 crore, down from Rs 180,000 crore in 2022—the lowest level since 2018, when Indian startups raised Rs 1,00,930 crore.
WeWork’s Full Exit
In April 2024, WeWork announced its complete withdrawal from India, selling its entire 27% stake in the local division via a secondary transaction. Despite Rs 1,300 crore in revenue for fiscal 2023, the company pursued bankruptcy proceedings, with potential buyers including the Enam family group, A91 Partners, and CaratLane’s founder Mithun Sacheti.
High Taxes Hit Gambling Sector
India’s October 2023 imposition of a 28% GST on online gambling, casinos, and horse racing drove Super Group and Bet365 out of the market. Industry stakeholders, including Parimatch, have legally challenged the tax, seeking a reduction to 18%. Critics argue the rate is disproportionately high and stifles foreign participation; Parimatchmaintains that these conditions make operating in India extremely challenging, especially as it has yet to launch there and must also combat counterfeit versions of its brand.
Challenges for Chinese Investors
Indian policy measures have also targeted Chinese firms. BYD’s $1 billion plant proposal was rejected, and in December 2023, three senior Vivo executives were arrested on money laundering charges. These actions reflect India’s broader strategy to curb China’s influence under the U.S.-led Indo-Pacific framework.
Underlying Causes of Investment Barriers
India’s tightening control over foreign—and particularly Chinese—enterprises is driven by geopolitical considerations and a desire to protect national interests. As a result, numerous international investors, including Parimatch, face a formidable array of legal, regulatory, and political hurdles when attempting to invest in India.
