US online tech behemoth, Google, is set to make a massive $4.5 billion investment in India’s biggest telco, Reliance Jio.
Through its digital subsidiary, Jio Platforms, Reliance Jio has attracted enormous amounts of foreign investment in recent months.
Google is the latest US internet giant to acquire a stake in Jio Platforms, following Facebook’s decision to invest earlier this year.
Google will acquire a 7.73 per cent share in Jio Platforms for 33,737 crore rupees ($4.5 billion), according to a release by Reliance Jio.
Reliance Jio has been instrumental in facilitating India’s digital revolution, supplying ultra-low cost 4G data tariffs and handsets to over 380 million subscribers across India. The company has seen a meteoric rise in subscriber numbers since it launched in 2016 and this year overhauled Vodafone Idea to become India’s biggest telco.
Jio has also made the headlines in the US for facilitating India’s digital transformation without the use of network equipment from under fire Chinese vendors, such as Huawei and ZTE – a move which will certainly have attracted admiring glances from key players in the US.
“Reliance Industries, and Jio Platforms in particular, deserve a good deal of credit for India’s digital transformation. The pace and scale of digital transformation in India is hugely inspiring for us and reinforces our view that building products for India first helps us build better products for users everywhere. Google is proud to invest ₹ 33,737 crore into Jio. I am excited that our joint collaboration will focus on increasing access for hundreds of millions of Indians who don’t currently own a smartphone while improving the mobile experience for all,” said Sundar Pichai, CEO of Google and Alphabet.
Reports in the press had suggested that Google could be poised to make a multi-billion dollar investment in Jio’s cash-strapped rival, Vodafone Idea. However, Google seems to have decided against this strategy, in favour of signing off on the Jio deal.
Jio Platforms and Google have also entered into a commercial agreement to jointly develop an entry level affordable smartphone with optimisations to the Android operating system and the Play Store.
“Google has empowered millions of Indians to access helpful information and, like Jio, is a force for change and innovation. We welcome Google onboard and are excited about our partnership for what it can deliver to Indians, from universalising Internet usage to deepening the new digital economy and providing a prime mover to India’s economic growth. Together, we hope to play a strong facilitative role in the transformative journey of building a new, Digital India,” said Mr. Mukesh Ambani, chairman and managing director of Reliance Industries.