Déjà vu: The Great Indian Brain Drain kicks again. This time in web3

Often when a person of Indian origin is appointed as a CEO at a top global company, the first debate that echoes, from every news channel to every household in India is what if this talent was here in India? Would we be a superpower just like the west?

This is not just the story of a few people. Millions of young talented Indians, over the years, from various disciplines have left our soil in search of better career and business opportunities. Over the last few days, this is a prime topic of discussion within the crypto groups and web3 meetups.

When CoinDCX closed its series D funding round recently, a lot of people asked me - is this brain drain real? Are Indian crypto entrepreneurs really moving out of the country? 

Unfortunately, the answer is yes!

According to the UN World Migration Report 2020, India has the highest number of migrants living abroad with over 17.5 million. In fact, India ranks no. 1 when it comes to the migration of the rich and the educated – it accounts for a massive 65% global share, way ahead of China and the Philippines.

A different study done by the Associated Chambers of Commerce and Industry of India (ASSOCHAM) estimated that the hundreds of thousands of Indian students now studying abroad cost India as much as US $17 billion a year in lost revenue.

India is viewed as a global superpower and is tagged as a land of opportunities. It has one of the world's youngest workforces that is not just educated but also growth and result-driven. 

At CoinDCX, we strongly believe India has immense potential to become a web3 superpower. India is home to millions of engineers and developers and is an undisputed technology powerhouse. Interestingly, crypto/web3 is a pure technology-led industry, where India is sitting on a golden opportunity. We have a significant strategic advantage, both economically and strategically.

According to "International Migration 2020 Highlights", a report issued by the Population Division of the United Nations Department of Economic and Social Affairs (UN DESA) in January 2021, India witnessed the sharpest increase in people migrating overseas, at nearly 10 million (one crore), between 2000 and 2020. This is grave and something that needs to be looked at seriously!

India- a sleeping Web 3 giant

While the world has already seen the prowess of India in its IT development of Web2 via the outsourcing model, Indian companies have already taken good strides in Web3 or, as called, the "intelligent" internet, while being based in India. Even with the nascency, India is already giving into the platform's advantageous landscape, with a lot of venture money flocking into Indian startups showing an inclination towards web3. Also, software development is the spine of Web3, which India already has mastered. 

Mr. Satya Nadella, the CEO of Microsoft, while speaking at Microsoft’s ‘Future Decoded’ event in Bengaluru, stated that India is home to 4.2 million developers. And if we narrow it down to only blockchain and web 3, some data estimates from 2018 indicate that India had the second-largest number of blockchain developers in the world, just behind the U.S. and one can be sure that this number has gone higher as the adaption of cryptocurrency, blockchain and web3 is on the rise across the globe

The Web3 Brain Drain

With the drain already taking away a lot from India over the past couple of decades, we seem to be moving in the same direction again with an industry that began to bloom, marking India's presence on the global map. Speaking of the blockchain/ Web3 industry, the legal ambiguity followed by the recent tax announcement of a 30% crypto tax without the relief of setting off losses seems to be a step far too aggressive, pushing a lot of talent out again. And it's not just the people; what goes out with them is also some great ideas which would have got more foreign exchange to the country in terms of investment. Having an open progressive view not just helps the entrepreneurs who want regulatory certainty, and flexibility to innovate with new business models but also attracts billions of dollars of new investments coming into the country. 

According to a September 2021 report by Nasscom India already has 230 crypto tech startups all with fresh ideas and innovations some of which could become key players when Web3 becomes the new norm. Their relocation due to a non-conducive growth environment would have high repercussions and could lead to tremendous loss to the economy in years to come. This is in number terms could be grasped by the following data that according to a US-India Strategic Partnership Forum (USISPF) report, Web3 will contribute USD 1.1 trillion to India's GDP, propelling the digital Indian economy's value from USD 5 billion in 2021 to USD 262 billion by 2031- A key contribution to Narendra Modiji’s USD 5 trillion economy mission.  

Web 3.0 a $1.1 trn growth opportunity for India: USISPF-CrossTower research | Business Standard News

With remote work getting more acceptable, foreign companies have already started tapping India’s web3 talent pool. Other countries are also stepping up and denting India's chances of becoming a superpower by offering favorable tax frameworks and a conducive environment to grow. India missed out on the first-mover advantage in Web1 and Web2 in the 90s and 2000s. The early mover advantage that India has gained with Web3 might also be lost, drowning India's ambition to become a tech superpower.

There is a massive on-ground interest from engineers and entrepreneurs to build for crypto/web3. And if the web3 environment is made a little more favorable, there is nothing that can stop India from building the next set of internet companies that are made in India but built for the world!