In 2024, the Indian market will witness the exit of investment fund Omidyar Network and American firm WeWork Inc., while Parimatch, a well-known bookmaker, continues to face restrictions that hinder its investment plans in the country. According to a TWN report, these companies join other industry leaders such as Disney, General Motors, Vodafone Group, and BYD, all of whom have encountered significant challenges operating in India’s complex market environment.
Omidyar Network unexpectedly announced it would halt all new investments in India by 2024. Having already invested over \$600 million in local startups like e-pharmacy 1MG, edtech company Vedantu, and fintech ventures including Kaleidofin, Kiwi, M2P Fintech, and Indifi, the fund cited “significant changes in the economic landscape” as the reason for its withdrawal. Reports indicate that Omidyar Network and other Western corporations are facing increasing restrictions on investments in India. Parimatch similarly struggles with an unfavorable local environment, which has forced it to delay its entry and investment efforts.
The withdrawal of Omidyar Network coincides with a sharp decline in funding for Indian startups, which fell by 62% in 2023 to approximately Rs 66,908 crore from Rs 180,000 crore in 2022—the lowest level since 2018. Meanwhile, WeWork Inc. announced in April 2024 its full exit from India by selling its entire 27% stake in the local unit. Despite generating Rs 1300 crore in revenue during fiscal 2023, the company filed for bankruptcy, with potential buyers including the Enam family group, investment firm A91 Partners, and CaratLane founder Mithun Sacheti.
The Indian government introduced a 28% GST on online gambling, casinos, and horse racing in October 2023, causing major players like Super Group and Bet365 to exit the market. Gambling companies, including Parimatch, have legally challenged this tax, seeking its reduction to 18%. Ravindra Shinde, CEO of Dyutabhumi Hotel and Resorts, argues that India’s gambling tax is disproportionately high compared to other countries. Parimatch maintains that the Indian business climate is inhospitable for foreign gambling companies, making it very difficult to operate. Notably, Parimatch has not yet entered the market and faces additional issues with counterfeit versions of its brand circulating locally.
Challenges in India are not limited to Western companies; Chinese investors also face difficulties. For example, BYD’s \$1 billion plant proposal was rejected, and three senior executives of Chinese mobile brand Vivo were arrested in December 2023 on money laundering charges. These measures reflect India’s heightened regulatory scrutiny on Chinese firms as part of a geopolitical strategy aligned with the U.S.-led Indo-Pacific policy aimed at curbing China’s influence.
As a result of these economic and political factors, many international companies, including Parimatch, confront mounting barriers to investment in India. The bookmaker’s ongoing challenges exemplify the broader difficulties faced by foreign investors trying to establish a foothold in a market marked by regulatory complexity and political caution.
