India needs a digital goods marketplace and control of its distribution layer, say Indus Appstore and Eloelo

India’s app-first economy still lacks a thriving marketplace for digital goods, and fixing that is as much a question of sovereignty as of technology, according to speakers at the 17th edition of YourStory’s TechSparks.

Speaking on a panel titled “India’s digital economy 2.0: Public tech, AI sovereignty, and the next 500 million”, Priya Narasimhan, Chief Business Officer at Indus Appstore, said the country’s mobile-first habits should have produced a large digital goods market, but have not. She blamed distribution monopolies held by Google and Apple and the economics of their 15% to 30% billing commissions, which make lower-priced digital products unviable. Web stores, the other route, suffer from user friction and low reach, she said.

Narasimhan argued that digital sovereignty is about how and where consumers meet technology. She named three layers India must control: discovery and distribution through app marketplaces, monetisation and billing, and a data trust and consent framework. She pointed to the Epic Games and Google dispute in the US as proof of what happens when developers depend on gatekeepers. She stressed, however, that sovereignty does not mean rebuilding every base layer. The aim, she said, is to plug into global technology on India’s terms.

Sagar Gaonkar, CTO of Eloelo Group, said India’s strengths lie in its data, its cultural variety and its creative and platform-building talent. Chips and large language models can be built upon, he said, with value added for India and then exported. He added that security cannot be an afterthought as more tools are hosted outside the country.

On AI, Gaonkar said it helps microdrama platforms decide what to greenlight before a frame is shot, and personalise what viewers see. He also pointed to stories that adapt to a viewer’s preferences. Narasimhan said app stores must become hybrid platforms: simple and familiar on the surface for most Indians, and addressable by AI agents at the back end, so that developers can scale whether users tap an icon or ask a chatbot.

Both speakers challenged the idea that Bharat is a low-spending audience. Narasimhan recalled that PhonePe’s gold category scaled only after it allowed purchases of Rs 10 a day. Gaonkar said Indian users are value-conscious rather than unwilling to pay, and need a softer landing to experience a product before paying. Narasimhan also urged founders to talk to users rather than rely only on analytics.

Responding to audience questions, Narasimhan said Indus aims to cut the commission burden on developers, and rejected the suggestion that Indians do not value digital goods, citing microdramas, OTT and gaming. She said platforms should not let discovery become purely pay-to-play. On fraudulent installs, she said vetting combines automated checks with human review and constant monitoring, but admitted that no system is foolproof.