If the buzz is to be believed telecom industry disruptor Reliance Jio Infocomm Ltd is getting ready to go places, starting with Estonia. According to Mint, Jio will set up a subsidiary in the Baltic nation, which will be handed a loan of Rs 12.20 crore to begin operations by Reliance Industrial Investments and Holdings Ltd, an investment holding company and a wholly-owned subsidiary of Reliance Industries Ltd (RIL).
“Thanks to its sophisticated e-solutions, over the last decade, Estonia has transformed itself into one of Europe’s business success stories. Indian companies would certainly wish to collaborate and imbibe e-governance solutions in this regard and Jio is no exception,” a second source told the daily.
To remind you, India and Estonia have already signed memorandums of understanding in the field of ICT. Then, in March, Republic of Estonia’s Entrepreneurship and IT Minister Urve Palo visited India and invited desi entrepreneurs to sign up for e-residency, using which they can conduct a business from Estonia.
“E-residency does not give citizenship but e-residency holders can access to e-governance services of Estonia and conduct their business without even visiting Estonia. It gives entrepreneurs access to European market,” Palo had said at the time. It also works out to the advantage of Estonian firms since they gain business opportunities from e-residents.
The programme’s press release had added that e-Residency stands for ‘Make in India & Sell in Europe’. Launched in 2014, it reportedly has over 30,000 takers from 154 countries already. Significantly, according to a representative of Estonia, by 2025, e-residents are expected to add a total of 1.8 billion euros to the country’s economy, be it in terms of state fees and taxes or through job creation, incremental demand, increased administrative efficiencies et al. Incidentally, among the over 1,200 Indians who are e-residents currently is Union Minister for Electronics and IT – as well as Law Minister – Ravi Shankar Prasad. He was given e-residency of Estonia when he visited the country last year.
It is this e-residency programme that Mukesh Ambani is hoping to leverage on in taking Jio global. According to an IANS report, Ambani had met up with the Estonian government delegation during their March visit and had expressed interest in collaborating with the country to develop better e-governance solutions for India. He had also stated that the e-residency programme – which offers startups access to a government-issued digital ID, thus enabling the opening of a global EU company fully online – is the gateway to do business in Europe.
Given that the European market accounts for 500 million people, it certainly makes an ideal launch-pad for Jio’s international aspirations. “Reliance Jio would want to diversify because, like its competitors, it too is under great pressure in the Indian market. There is every reason to believe that the company may be running operations below cost,” Mahesh Uppal, director at communications consulting firm ComFirst India told the daily. “In such an environment, it makes sense for any company to diversify in markets where the margins may be better. Besides, the European Union has long worked for a single telecom market. Being in Estonia does give you a foothold to expand further in Europe and helps Jio to mitigate some of the risks in the Indian market.” – Business Today