Tech and Digital Ecosystem - Newspaper Summary

 The sources portray India's Technology and Digital Ecosystem in October 2025 as a dynamic landscape marked by strategic government focus on domestic innovation, rapid advancements in Artificial Intelligence (AI) and digital financial infrastructure, juxtaposed with global hiring slowdowns and regulatory challenges in critical sectors like online gaming.

I. Strategic Digitalization and 'Swadeshi' Technology Push

The Indian government and key domestic players are intensely focused on developing and promoting home-grown digital solutions across various critical domains to enhance digital self-reliance and mitigate reliance on global providers.

Promoting Indian Digital Public Goods

• The government is actively supporting and promoting indigenous options beyond mere messaging platforms or business software.
• The objective is to develop India’s own solutions across categories like operating systems, social media platforms, email systems, mapping technologies, cybersecurity, and app stores to prevent "access disruptions" associated with using global providers.
• The 'swadeshi' push is already underway in certain areas, such as defining standards for "trusted providers" in critical hardware like closed-circuit television (CCTV) systems, with steps planned to replicate this for industrial IoT systems to improve data security.
• The Ministry of Electronics and Information Technology (MeitY) has partnered with academic institutions to develop BharatDB, a secure, high-performance, enterprise-grade, open-source database system intended for commercial and government use.
• Zoho, an Indian SaaS firm, was selected by MeitY a few years ago to handle email services and internet-based office solutions for government departments.
• Union Ministers have publicly demonstrated the use of Zoho’s presentation software and maps sourced from MapmyIndia Mappls as part of their work. The Co-founder of MapmyIndia commended the government’s efforts to create awareness around Indian products and requested that smartphone makers pre-load Indian equivalent apps, such as Mappls, alongside global ones to counter monopolistic tendencies.

Indigenous App Adoption: The Arattai Example

• Arattai, an indigenous messaging app built by Zoho, has recently grown in popularity, especially after multiple Union Ministers expressed support and intent to move to the platform for communication.
• In September (month-to-date), Arattai amassed about 400,000 downloads in India, a significant jump from less than 10,000 in August, and has crossed 1 million users.
• However, analysts note that the platform will need to significantly scale its infrastructure and customer support capabilities to compete with giants like WhatsApp (which has over 500 million users in India), and must overcome challenges related to data security and winning user trust.

II. AI, Digital Infrastructure, and Financial Technology

Artificial Intelligence (AI) is central to India's technological future, driving financial innovation, transforming industry, and influencing global tech giants.

The Rise of Agentic AI and India's Transformation

• The sources highlight the rise of Agentic AI—autonomous systems capable of understanding goals, creating plans, and executing complex tasks—as a profound shift in the technology sector.
• This is seen not as a threat but as a "promotion" for Indian engineers, moving them from being masters of execution to orchestrators of intelligence and the nation's "brain trust".
• The vision is for Agentic AI to infuse the 'Make in India' capacity with intelligence and autonomy.
• Applications Across Sectors:
  • Manufacturing: AI agents could autonomously manage factory floors, scheduling predictive maintenance and dynamically rerouting shipments based on live data, creating resilient, self-healing supply chains.
  • Financial Services: Building on the Jan Dhan-Aadhaar-Mobile (JAM) trinity, AI financial agents could offer personalized services, such as analyzing monsoon forecasts and soil health to recommend optimal crops, apply for micro-loans, and even negotiate sales on the Open Network for Digital Commerce (ONDC).
  • Healthcare: AI diagnostic agents, run on tablets used by ASHA workers, could analyze patient symptoms, suggest preliminary tests, and autonomously schedule tele-consultations with specialists in metro cities, thereby democratizing medical expertise and bringing it to the last mile.
• India must cultivate this transformation by building on the India Stack (UPI, ONDC, Aadhaar), launching a National Skilling Mission focused on strategic and ethical skills, and proactively establishing ethical frameworks and regulatory sandboxes.

Digital Payments and Security Initiatives

• The Ministry of Road Transport and Highways (MoRTH) manages Vahan registration, a digital vehicle registration system allowing vehicle owners to apply for registration and transfer ownership online.
• SEBI launched two new initiatives to enhance payment security and curb fraudulent fund collection in the securities market:
  • Validated UPI Handles: An exclusive "@valid" UPI handle for SEBI-registered investor-facing intermediaries (brokers/mutual funds) has been created. Major brokers (covering over 90% of investors) and all mutual funds have adopted this, featuring a distinctive thumbs-up icon in a green triangle and a special QR code for authenticity.
  • SEBI Check: A verification tool allowing investors to independently confirm the bank account details and UPI IDs of intermediaries through the SEBI Check platform or the Saarthi mobile app.

E-commerce, Retail Tech, and Logistics

• Small businesses and kirana store owners are increasingly adopting innovative technology, including Artificial Intelligence (AI), to generate product images and descriptions to boost sales during the festive season.
• Small retailers are using platforms like Kirana Pro and ONDC to adapt to the reality presented by quick commerce.
• Quick commerce platforms (like Blinkit, Swiggy Instamart, and Zepto) are moving upmarket to improve margins by offering premium products, such as ozone-washed fruits, HACCP-certified produce, artisanal sourdoughs, and imported European cheese.

Digital Financial Evolution: Deposit Tokenization

• India's financial ecosystem is undergoing a transformation, with customers moving savings from traditional bank deposits to capital markets, challenging banks’ ability to retain low-cost deposits (CASA).
• The concept of deposit tokenization—converting conventional bank deposits into programmable digital tokens recorded on Distributed Ledger Technology (DLT)—is firmly on the regulator's radar.
• Benefits of Tokenization: It preserves the legal status of deposits but adds the agility of digital assets, enabling real-time atomic settlement, smart contract integration, and cross-border interoperability. This could help stabilize bank liquidity by integrating deposits into capital market workflows, such as executing programmable Systematic Investment Plans (SIPs) or settling IPO proceeds instantly.
• Regulatory Status: While India has yet to formally experiment, the former RBI Deputy Governor acknowledged its potential to increase liquidity and reduce costs but cautioned that it could "amplify the speed and scale of withdrawals during stress events". Controlled pilots, perhaps within GIFT City’s regulatory sandbox, are suggested as the next logical step.

III. IT Sector Performance and Talent Challenges

The Indian IT sector faces headwinds due to global uncertainty, impacting hiring and prompting labor disputes, even as global tech giants focus on AI strategy.

Subdued IT Growth and Talent Demand

• The Indian IT sector is experiencing subdued growth, with a muted outlook for FY26, though recovery is anticipated in FY27, driven by a recovery in export markets and the adoption of new technology, particularly AI adoption at the enterprise scale.
• Talent demand in the tech sector saw a 27% year-on-year decline in active job opening projections in October. IT services saw a 24% y-o-y drop (42,000 new openings), and software products declined 22% (26,000 openings).
• In contrast, Funded tech start-ups and Global Capability Centres (GCCs) showed positive signs, with a 13% and 2% increase in job demand, respectively. GCCs now account for roughly 10% of total tech talent demand.
• Entry-level job openings declined by 19% y-o-y, while mid-junior level openings marked the sharpest decline at 28%.

GCC Evolution and AI Focus

• Indian Global Capability Centres (GCCs) are transforming from mere cost-saving "captives" into strategic Global Value Centres that drive innovation and revenue for their parent companies.
• This evolution is marked by a shift in autonomy, empowering GCC leaders to make critical decisions on technology adoption, project financials, and team composition, responsibilities previously held by global headquarters.
• IBM Consulting notes that GCCs are driving innovation, with IBM focusing on recruiting and skilling talent capable of working with tools and technologies like AI/cybersecurity, and specifically the ability to "cleanse the data to be AI-ready".

Layoffs and Labor Disputes

• A Lok Sabha MP asked the Central government to intervene in the "illegal layoffs" at Tata Consultancy Services (TCS) and other IT/ITeS firms, alleging they prioritize profit over workers' livelihoods.
• The MP alleged that TCS’s announced plan to lay off 12,000 employees is part of a wider trend of mass retrenchments, often occurring in violation of the Industrial Disputes Act, 1947.
• Labor unions claimed that far more employees are being affected (with one estimate suggesting 50,000 in the current quarter alone) and alleged that employees are being coerced into resigning for a favorable recommendation letter. TCS denied these allegations, citing that the initiative aims to realign skills and that affected employees were provided severance.

Global Tech Focus on AI and Chip Industry

• The global chip industry is experiencing a massive rally, adding $200 billion in market value due to the AI frenzy. This is driven by events such as OpenAI's record valuation and its agreements with South Korean chipmakers.
• Microsoft is reorganizing its leadership, naming a new CEO for Commercial Business to free up Satya Nadella to focus on technical work related to the AI race, including data center buildout, AI science, and product innovation. Microsoft also struck over $33 billion in commitments with "neocloud" companies (like Nebius Group NV) to cope with the shortage of AI data center capacity and free up its own servers for lucrative AI services.
• OpenAI's valuation soared to $500 billion, making it the world's largest startup, after a deal allowing current and former employees to sell shares. This milestone coincides with a global push by companies like OpenAI and Nvidia Corp. to build data centers and develop AI services.

IV. Electronic Manufacturing and EV Ecosystem

The government is supporting electronics component manufacturing, while the Electric Vehicle (EV) market shows mixed growth.

Electronics Component Manufacturing Scheme (ECMS)

• The ECMS, approved by the Cabinet in March, has received an overwhelming response, attracting 249 applications proposing investments totaling ₹1.15 lakh crore ($13 billion).
• This proposed investment is nearly double the target of ₹59,350 crore.
• The production estimates received exceed ₹10.34 lakh crore ($116 billion), more than double the targeted ₹4,56,500 crore, helping India move toward a target of a $500 billion domestic electronics ecosystem by FY31.
• The scheme is expected to create 1.41 lakh jobs, exceeding the initial target of 91,600.

EV Market Growth and Infrastructure

• Pure electric vehicle two-wheeler (e-2W) registrations rose 2% month-on-month in September 2025 to 92,536 units, despite a slowdown in sales during the GST 2.0 transition.
• The e-2W segment maintains a competitive edge due to the 5% GST rate, combined with lower running costs, even though the price gap with sub-350cc internal combustion engine (ICE) two-wheelers has narrowed due to GST cuts on the latter.
• Registrations for Tesla (60 cars) and VinFast (6 EVs manufactured at the Thoothukudi plant) electric vehicles began in September, adding to market competition.
• The growth of electronics, semiconductors, and electric vehicles in India is cited as a driver for the expansion of manufacturing capacity by global suppliers like Kanthal in Hosur.
• The availability of magnets continues to pose challenges in the short to medium term for the e-2W industry.

V. Regulatory Framework for Online Gaming

The government has introduced a new framework to govern the fast-growing digital gaming ecosystem, seeking to create clarity while distinguishing between game types.

• The government issued detailed rules under the Promotion and Regulation of Online Gaming Act, 2025.
• A new Online Gaming Authority of India has been established with powers to register games, set up grievance redressal systems, and impose penalties.
• The Authority will determine if a game is an "online money game" (involving wagers, stakes, or cash prizes) or a "social game" or "e-sport".
• While social and e-sports platforms can apply for five-year registrations, money games face the risk of prohibition and advertising bans.
• The new rules signal the intent to draw a sharper line between permissible gaming and gambling.
• Industry Response: Non-real-money gaming (RMG) funding increased significantly by 2024, taking the lion's share of total online gaming investment. However, analysts are skeptical that casual and social gaming can fully compensate for the economic void left by the RMG ban, which accounted for 77% of gaming monetization previously.