Google will buy a $4.5 billion stake in Reliance’s digital unit and jointly develop an entry-level smartphone with the Indian conglomerate, the 2 companies said Wednesday as global tech giants race to grab a share of the country’s massive market. “We are delighted to welcome a household name in India and worldwide, Google, and have signed a binding partnership and investment agreement,” which can give the US firm a 7.7 percent stake in Jio Platforms, Mukesh Ambani told shareholders at the oil-to-telecom behemoth’s annual meeting.
The two firms will develop “an Android-based smartphone operating system”, Ambani said, adding: “India is at the doorstep of (the) 5G era.”
Major players including Facebook, Intel et al have already plowed some $15 billion into Jio Platforms this year, as Ambani — India’s richest man — seeks to require on US giants Amazon and Walmart in India’s growing online retail sector. The tycoon, who upended India’s telecom sector after launching the Jio mobile service in 2016, is looking to roll out an e-commerce initiative that may tap into its huge 388-million-strong subscriber base.
Jio’s mobile offering clobbered the competition, offering huge discounts on its services and forcing rival firms to crash out after they were unable to stay up. In recent months Ambani has raised over $22 billion in a very right offering and thru selling stakes in Jio Platforms, and announced last month that Reliance was now net debt-free as a result. Google said it might invest $10 billion in India over the subsequent five to seven years.
Foreign firms have spent tens of billions of dollars in India in recent years as they fight for a chunk of the Asian giant’s burgeoning digital economy.