Sunil Barthwal’s Remarks at IPEF Investor Forum Shed Light on Growing Phenomenon
In a significant address at the Indo-Pacific Economic Framework for Prosperity (IPEF) Clean Economy Investor Forum, Sunil Barthwal, the Commerce Secretary of India, underscored the burgeoning trend of “Desh Wapsi” (return to the homeland) among Indian startups. Barthwal attributed this trend to the robust growth of the Indian economy, which is currently outpacing many emerging economies worldwide.
Barthwal emphasized the pivotal role of the digital economy and emerging technologies like Artificial Intelligence (AI) in driving India’s future growth trajectory. His remarks resonated strongly with the 60 attendees comprising investors and government officials from various countries who gathered for the event.
The IPEF, established in May 2022 with 14 member countries, aims to promote collaboration in critical areas such as trade, supply chain optimization, and fostering clean and fair economies.
The Commerce Secretary’s comments come at a juncture where an increasing number of Indian startups headquartered overseas are contemplating relocating their operations back to India. This trend has been primarily fueled by the desire of several high-profile startups to list their Initial Public Offerings (IPOs) on Indian stock exchanges.
Recent examples include PhonePe, a digital payments giant backed by Walmart, which relocated to India in late 2022. Similarly, fintech unicorn Groww completed its reverse flip from the US to India in March, while reports suggest that e-commerce behemoth Flipkart, also owned by Walmart, is exploring the possibility of shifting its parent entity from Singapore to India.
Other notable players such as Zepto and Razorpay are reportedly considering similar moves. Pine Labs, another fintech unicorn, recently obtained approval from a Singapore court to merge its Singapore-based entity with its Indian counterpart.
Despite the allure of returning to India, the process of reverse flipping has encountered significant challenges. PhonePe’s relocation incurred a hefty tax bill of $800 million, signaling the financial implications involved. Moreover, founders have cited bureaucratic hurdles, lengthy paperwork, and regulatory complexities as deterrents to relocating their operations back to India.
Barthwal’s remarks shed light on a compelling trend within the Indian startup ecosystem, highlighting both the opportunities and challenges associated with the phenomenon of “Desh Wapsi.” As India’s economy continues to chart impressive growth, the landscape for startups navigating their global presence is evolving, with strategic decisions being made to capitalize on the nation’s economic momentum.
