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After government puts out order extending ban, TikTok scales down Indian workforce

Several months after it was banned in India, TikTok has scaled down its Indian operations, citing the government’s inaction on a clear path forward. The company declined to say how many employees were affected. Two officials working with firms developing apps that were banned alongside TikTok told MediaNama that the ban was now “extended”, according to a communication received from the Ministry of Electronics & Information Technology (MEITY) which cited a committee recommendation, the sources told us. This could be why TikTok has opted to lay employees off instead of waiting a few more months. Reuters first reported the extension of the ban.

TikTok sent MediaNama this statement:

We have worked steadfastly to comply with the Government of India order issued on June 29, 2020. We continually strive to make our apps comply with local laws and regulations and do our best to address any concerns they have. It is therefore disappointing that in the ensuing seven months, despite our efforts we have not been given a clear direction on how and when our apps could be reinstated. It is deeply regretful that after supporting our 2000+ employees in India for more than half a year, we have no choice but to scale back the size of our workforce. We look forward to receiving the opportunity to relaunch TikTok and support the hundreds of millions of users, artists, story-tellers, educators and performers in India.

When asked about the extension of the bank in particular, TikTok sent MediaNama this statement:

We are evaluating the notice and will respond to it as appropriate. TikTok was among the first companies to comply with the Government of India directive issued on June 29, 2020. We continually strive to comply with local laws and regulations and do our best to address any concerns the government may have. Ensuring the privacy and security of all our users remains to be our topmost priority.

It’s not clear if the government would ever be open to reinstating blocked apps like TikTok. While the government cited national security concerns, incidents have progressed neatly in lockstep with the ongoing border conflict between India and China. While the first ban followed shortly after the May 2020 skirmishes at the Line of Actual Control, the second ban order was announced after further conflicts in September. Word of the extension, issued in the past week, comes after further clashes at the Sikkim border were reported. Reversing the ban of any of the Chinese-owned apps at a time when such skirmishes continue may turn out politically unpopular.

The Chinese embassy once again voiced its discontent at the ban of Chinese apps. In a statement issued Wednesday, embassy spokesperson Ji Rong said:

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Since last year, the Indian side has repeatedly used national security as an excuse to prohibit some Mobile Apps with Chinese background. These moves in violation of WTO non-discriminatory principles and fair competition principles of market economy severely damage the legitimate rights and interests of Chinese companies. The Chinese side firmly opposes them.

The Chinese government always asks Chinese companies to observe international rules and local laws and regulations when doing business overseas. The Indian government has the responsibility to follow WTO rules and market principles and protect the legitimate rights and interests of international investors including Chinese companies. These moves of the Indian government have also hindered the improvement of the Indian business environment and the innovative development of related Indian industries. China-India economic and trade cooperation is mutually beneficial by nature. We urge the Indian side to immediately correct its discriminatory measures and avoid causing further damage to bilateral cooperation.

Sources quoted above told us that representatives of apps not covered under the original 59-app ban, such as PUBG Mobile, were not sent the communication from MEITY. But they well be at odds with a similar ban extension; IGN India reported that at least in PUBG’s case, the government has “no plans” to revoke its ban, in spite of the app’s pledge to start using Microsoft servers in India to host multiplayer games and move control of the company to the South Korean owner of the PUBG brand, Krafton Corp.

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I cover the digital content ecosystem and telecom for MediaNama.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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