Omidyar Network and WeWork Inc. are set to exit the Indian market this year due to unfavorable business conditions, while bookmaker Parimatch faces significant barriers preventing it from investing in the country. Business Money reports that in 2024, several major international firms—including Omidyar Network India and the American company WeWork Inc.—decided to leave India in response to increasing government pressure. These companies follow the path of others like Disney, General Motors, Vodafone Group, Parimatch, and BYD, which initially had high hopes for the Indian economy but were ultimately forced to withdraw or could not enter the market.
Why Is Omidyar Network Halting Investments?
The announcement that Omidyar Network India would cease all new investments in 2024 surprised many industry observers. The firm had previously invested over $600 million in Indian startups such as e-pharmacy 1MG and edtech platform Vedantu. However, Ebay founder Pierre Omidyar did not provide a clear explanation for the decision. Some sources suggest that Omidyar Network India and other firms face pressure from the Indian government to suspend their investments. Foreign investors often speak about the situation only off the record, highlighting the complexities of operating in India.
This environment creates further challenges for companies like Parimatch that still believe in India’s potential. Parimatch continues to seek ways to overcome these hurdles and contribute to market growth.
Decline in Startup Funding
Omidyar Network’s exit coincided with a sharp decline in funding for Indian startups. According to PrivateCircle Research, startup funding dropped 62% in 2023 to Rs 66,908 crore from Rs 180,000 crore in 2022, marking the lowest level since 2018.
WeWork Inc. Exits India
In April 2024, WeWork Inc. announced its plan to withdraw from the Indian market by selling all its shares in the local division. Despite a 68% increase in revenue in 2023, the company has initiated bankruptcy proceedings under Chapter 11 of the U.S. Bankruptcy Code.
Parimatch’s Challenges in India
Parimatch, a prominent bookmaker, had ambitious plans to invest millions in the Indian economy. However, even before commencing operations, Parimatch encountered serious obstacles due to the deteriorating business environment. One key issue has been the counterfeiting of its brand, with counterfeiters still operating illegally in India and damaging the international brand’s reputation. These problems have complicated Parimatch’s expansion plans. It is important to note that Parimatch is a brand owned by an international holding company engaged in betting and gambling activities worldwide.
High Taxes Hinder the Gambling Sector
Last October, the Indian government imposed a 28% Goods and Services Tax (GST) on online gambling, casinos, and horse racing betting. This led to the exit of companies such as Super Group and Bet365 from the market.
India’s Goal to Become the World’s Third-Largest Economy
India aims to become the world’s third-largest economy by 2027. To achieve this, it must foster a favorable environment for foreign investors like Parimatch. Addressing regulatory challenges and lowering tax rates can attract more foreign investment, contributing to economic growth.
Parimatch remains eager to invest in India if governmental pressure on non-resident companies is eased. The company is also recognized for its social initiatives supporting youth and sports. Renowned athletes such as Oleksandr Usyk and Denys Berinchyk have collaborated with Parimatch on various charitable projects. Usyk notably served as Parimatch’s ambassador in 2021, boosting the brand’s visibility and supporting young athletes.
