TikTok effect? GoTo to pare Tokopedia's India operations after deal with China's ByteDance

“We were told that the operations will be reduced in the next 10 months due to a majority stake buyout by TikTok and the geo-political tensions with India,” an employee at Tokopedia India said on condition of anonymity.

“We have been asked to switch to other companies and a no-question policy has been initiated. In the timeframe, we will hand over control to the Indonesian team,” another employee said.

A no-question policy means if an employee manages to get a job in another company, he would be given an early release, sans notice period.

Both staff members, like many of their colleagues, are looking out for new opportunities.

Tokopedia team is yet to response to Moneycontrol's detailed
queries.

'Complete closure not likely'

A third source, however, disputed talks of a complete closure of India operations, terming it part of a larger internal restructuring within the group to hit key metrics.

“A complete closure may not take place, but some transition will happen. I am not denying that there is no heat over TikTok’s controlling stake in Tokopedia. There is a lot of internal discussion happening at global offices right now,” he said, maintaining that clarity is yet to come.

GoTo Group, which was formed after the merger of ride-hailing giant Gojek and e-commerce platform Tokopedia, made its India entry back in 2017 to run its R&D centres.

Over the years, India has become one of the key technology hubs for the Indonesian conglomerate, with over 1,000 engineers working in offices across Noida, Hyderabad and Bengaluru under the three registered subsidiaries--GoFin Labs, GoProducts and Tokopedia.

“The company operates a mobility business in Singapore, mobility, food delivery, logistics in Vietnam and engineering hubs in India,” the group’s prospectus states.

Of this, over 200 employees are dedicated to Tokopedia India, sources said.

Tiktok’s exposure

GoTo Group’s association with ByteDance is fairly new.

In December 2024, the Chinese investor pumped in $1.5 billion into Tokopedia to acquire a controlling stake of 75.01 percent, and merge its TikTok Shop Indonesia with the same.

The deal was a strategic move by TikTok to regain presence in Indonesia’s e-commerce industry, after its platform TikTok Shop was forced to suspend services over regulatory norms.

As of March 14, 2024, Tokopedia has completed the migration process with TikTok, and all the systems (including back-end processes and payments systems) have been transferred and managed by Tokopedia under Shop Tokopedia.

With the India entity handling the software development and information technology (IT) services for Tokopedia, the team is now wary of the Chinese firm’s exposure in the country, given its history with the government.

Several of ByteDance's apps, including TikTok, Helo and CapCut, were banned by the Indian government, citing national security issues in the first wave of Chinese app bans in June 2020.

The ban was made permanent in January 2021.

In the most recent diktat, the Chinese major put a stop button on its music- streaming service Resso in February, after it was removed from Google Play and Apple App Store following a government order, as reported first by Moneycontrol.

ByteDance attributed the shutdown decision to “local market conditions”.

Employees’ woes

Since the townhall, many employees in India have been on the lookout for safer pastures, despite limited clarity or a written statement from the company.

One of the engineers quoted earlier said some employees are being re-hired by GoTo’s other division—Gojek-- after interview rounds, and a few have been asked to move to the Indonesia office.

However, they complained of being “downgraded to lower positions” at the same salary.

“There are speculations around layoffs. Those employees who are left after this transition period will be allowed to go. So, to be on the safer side, everyone is looking to switch while we deliver KTs (knowledge transfers) to our Indonesian team,” he said.

“There is heavy attrition happening (at India office). Generally, the teams also don’t want to be involved with Chinese business,” a senior leader who recently left one of the group's firms said.