Mr Pranjal Agarwal, India Market Head at Mudrex
India is ready to ride the wave of Web3. Web3 in India makes the promise of more power, control and ownership for the people in the digital age. The future trajectory of Web3 in India will undoubtedly be shaped by three forces: India’s tech talent pool, the drive for innovation and the evolving regulatory landscape.
Web3, with a potential to contribute $1.1 trillion to the country’s economy by FY32, this growth signals a wealth of opportunities, from job creation and skill development to attracting global investment and fostering a new generation of digital entrepreneurs.
Current Landscape of Web3 in India
The current Web3 landscape in India is a mix of ambitious startups, engaged investors, and a growing community of developers. There are over 1000 ventures spanning diverse sectors such as finance, infrastructure, entertainment, and social platforms, and attracting over $2.5 billion in funding.
The trend in India leans towards the creation of globally-focused solutions. This focus on global solutions aligns with India’s ambition to further solidify its position as a tech powerhouse in Asia, challenging even China.
Meanwhile, India’s Web3 developer community has expanded from 3% of the global Web3 developer pool in 2018 to 12% in 2023. This rapid growth has attracted attention from local and global investors, further fuelling capital influx into the Indian Web3 space. Prominent venture capital firms like Coinbase Ventures are actively backing promising Web3 startups, recognizing the potential for high demand and growth.
The Next Frontier: Emerging Trends in Web3 in India
Web3 applications, particularly in areas like NFTs and gaming, are gaining traction in India and could play a pivotal role in expanding the crypto market. This potential is further underscored by the growing interest in blockchain technology, with 56% of Indian businesses reporting an inclination toward adoption.
As Web3 and crypto have a mutually reinforcing relationship, the growth of one stimulates the expansion of the other. These applications could act as a gateway, driving greater awareness and understanding of cryptos, and propelling its adoption beyond the current estimated 5% of the population.
This positive feedback loop, coupled with the promising growth of the metaverse market, projected to reach $33.9 billion by 2030, could pave the way for a thriving Web3 ecosystem in India, fostering innovation, economic growth, and individual empowerment.
The rise of Web3 gaming in India exemplifies this trend—both new studios and established Web2 companies like Hungama and Flipkart are converging towards the same goal. They are integrating Web3 features, creating a richer and more interconnected gaming landscape.
India’s Web3 Playbook
Document forgery is a pervasive problem in India, resulting in lack of trust in government systems and initiatives. Blockchain technology, with its immutable and transparent ledger, is an ideal fit for enhancing the integrity and trustworthiness of government systems.
The Indian government’s proactive role in the Web3 landscape is evident in its multifaceted approach to blockchain adoption, which goes beyond policy and strategy formulation. The Ministry of Electronics and Information Technology (MeitY) has not only unveiled the National Strategy on Blockchain in 2021 and introduced a five-year plan to integrate blockchain into various industries through the National Blockchain Framework, but it is also actively implementing blockchain solutions. The National Informatics Centre (NIC), a government agency under MeitY, currently hosts nearly eight million verifiable government-issued documents across three blockchains: Hyperledger Fabric, Hyperledger Sawtooth, and Ethereum.
These documents, covering areas such as education, property, judiciary, and drug logistics, originate from six different states and three government departments, namely the Central Board of Secondary Education, the Ministry of Consumer Affairs, and the Ministry of Justice. While the CBSE establishes blockchain as a means for delivering tamper-proof results, Raigarh District Administration’s ‘Tree Aadhar’ uses a NEAR protocol based implementation to enhance accountability in CSR Tree planting activities. Meanwhile, the Reserve Bank of India (RBI) is taking the lead in developing the Digital Rupee, India’s Central Bank Digital Currency (CBDC) with the goal of financial inclusion.
Furthermore, NIC is actively developing proof-of-concept blockchains dedicated to land records, blood banks, tracking goods and services tax, and a public distribution system—the Government machinery is moving at an accelerated pace to streamline critical services by harnessing blockchain tech.
The scope of Blockchain-tech solutions India doesn’t stop there: The New Town Kolkata Development Authority (NKDA) showcases the real-life adoption of blockchain with the first-ever NFT-based land mutation in India. With a vast expanse of 27,000 acres of land and a staggering 50,000 NFTs representing one million ownerships, the NKDA’s adoption of NFTs for land mutation has revolutionized the traditional approach.
50% of Indian state governments are actively exploring blockchain applications to address real-world issues in sectors like agriculture, land registry, healthcare, and governance, with initiatives such as Telangana’s Blockchain District and Tamil Nadu’s blockchain adoption policies.
India’s Web3 Momentum: Early Wins and Future Promise
The journey towards India’s Web3 dominance is paved with both easy and moderate wins. The Indian government’s proactive approach to blockchain technology showcases the potential for widespread adoption and impact.
The establishment of the Centre of Excellence (CoE) in Blockchain technology by NIC further strengthens India’s position as a leader in blockchain innovation. The CoE’s focus on collaboration and its development of use cases across various sectors highlight the tangible benefits that blockchain can bring to Indian society.
Pilot projects and proof-of-concept solutions, such as the blockchain-based property registration system piloted in Telangana, and the blockchain-enabled cloud security assurance and trade finance solutions, have demonstrated the viability of blockchain across diverse domains, from property registration to academic certificate authentication.
Initiatives like DigiYatra, leveraging blockchain for seamless and secure travel experiences, highlight the government’s commitment to exploring real-world applications of this technology.
The opportunities presented by Web3 in India are immense. DeFi platforms have the potential to revolutionize financial inclusion, providing access to essential financial services to the unbanked and underbanked populations. The gaming sector, fueled by the play-to-earn model and the rise of Web3 gaming studios, is poised to create significant economic growth and job opportunities. At the heart of it all, a balanced regulatory framework is key to driving the growth of the Web3 ecosystem.
A regulatory ecosystem that fosters innovation while ensuring consumer protection, coupled with increased collaboration between the government, industry, and academia, will pave the way for the widespread adoption of Web3-Tech and ultimately unlock the full potential of a decentralized internet. The nation’s vibrant tech talent pool, coupled with its strong entrepreneurial spirit, positions it well to overcome these challenges and emerge as a global leader and as a better India in the Web3 revolution.
