WP2008/09: South-South Investment in Infrastructure: The Operation of Indian Firms in Developing Countries, Jaya Prakash Pradhan, August 2008

Abstract: Since 1990s South-South investment flows have assumed a considerable significance in the economic relations among developing countries. The host developing countries tend to see the growing FDI flows from co-developing economies as a prospective source of financial capital, skills and technologies useful for their economic development. However, there is clearly a lack of recognition among them about the potential of southern investment in improving their civil, social and industrial infrastructure. A distinction can be made between the two main forms in which developing country firms participate in the infrastructure sector of co-developing countries. The first is the project exports resorted by southern firms in various infrastructure areas like transportation, communication, energy, etc. The second form comprises direct investment operation of southern firms to provide infrastructure services to the end users. India presents a classic example of South-South investment in infrastructure sector with Indian firms consistently expanding their project exports and infrastructure-related FDI activities over the years. In the light of growing size of Indian project exports and infrastructure FDI, this study calls for evolving a holistic policy framework by both home and host developing countries to enhance the potential of such investment for infrastructure development.

WP2008/08: Indian Direct Investment in Developing Countries: Emerging Trends and Development Impacts, Jaya Prakash Pradhan, June 2008

Abstract: This study has analyzed the overall and regional trends in Indian direct investment flows into developing region since 1960s and explored various development impacts they have on host developing countries. Evidence tends to indicate that developing region was the initial destination for Indian outward investing firms and continued to receive their attention over time. Developing region bound Indian FDI, which was led by a small group of Indian firms in a few selected developing countries in 1960s–80s, is now giving way to a more extensive pattern with large quantum of outward investment. A large number of Indian firms are undertaking increasing investment activities across different sub-regional developing groups and for a variety of firm-specific motivations. The fact that developing region oriented Indian firms are operating in knowledge-based industries and are undertaking local production activities than simply performing sales promotional functions, their presence could be critical for host developing countries aspiring to build their domestic capability in such technology-intensive industries.

WP2008/07: Investment and Growth in India under Liberalization: Asymmetries and Instabilities, Surajit Mazumdar, March 2008

Abstract: This paper makes the case that the growth trajectory of the Indian economy in the post-1991 liberalization period is characterised by an inherent source of instability in manufacturing and industrial growth that distinguishes this period from the 1980s. This instability is a result of an investment-growth asymmetry that flows from a combination of a services-intensive growth pattern and a manufacturing-intensive investment pattern. These in turn reflect the pattern of demand expansion within the domestic economy as well as in external markets and also the reliance on private corporate investment as the driver of the economy’s investment process. In such circumstances, the maintaining of the balance between capacity creation and demand expansion in the manufacturing sector becomes impossible. Investment is thus prone to a high degree of instability, which through its effects on demand, also makes industrial growth highly unstable. The services-intensive growth trajectory after 1991 is, therefore, more correctly viewed as one which is unable to fully utilize the capital accumulation potential of the economy rather than as a trajectory cheap in the use of capital. Correcting this problem however requires measures that are inconsistent with a liberalized economic policy regime.

WP2008/06: Media the Key Driver of Consumerism: Macro-Micro Linkage and Policy Dimension—A Case Study of FM Radio, Abhilasha Kumari, March 2008

Abstract: This paper traces the changes in radio policy highlighting the influence of the political economic vision of the Indian state. Emphasizing that changes in media policy have followed the same trajectory as economic policy, namely that of liberalization, deregulation and globalization, the paper argues that these have contributed to the creation of a depoliticized transnational consumerist media and culture, addressing which requires policy intervention to support alternative structures that could sustain plurality and diversity in the media.

WP2008/05: Structural Change in Employment in India since 1980s: How Lewisian is it?, Satyaki Roy, March 2008

Abstract: Indian economy has shown high levels of growth and per capita income in recent years accompanied by an unprecedented shift of labour from agriculture to non-agriculture during the last decade. Reallocation of labour from ‘traditional’ to ‘modern’ segments in an economy having large surplus labour was conceived in the Lewisian framework as the process by way of which both accumulation of capital and exhaustion of surplus labour takes place. This paper argues that the structural change in employment in India that results from the exclusionary nature of the growth process hardly approximates the Lewisian trajectory. Finally, in the context of globalisation this paper explains the responses of firms of various size categories in non-agriculture and argues that the shift in employment basically expands the ‘reserve army of labour’ in the Marxian sense instead of exhaustion of surplus labour conceived in Lewisian conjectures.

WP2008/04: Crony Capitalism and India: Before and After Liberalization, Surajit Mazumdar, March 2008

Abstract: This paper, the second in the series, initiates the examination of the nature of the relationship between private capital and the State in India. While the principal focus is on the present context of India under a liberal economic policy regime, both the past of Indian capitalism and the past discussion on the concentration of economic power are also brought into the picture to substantiate the key arguments. The paper provides theoretical and also some limited empirical substantiation for the proposition that unlike what would be the prediction of crony capitalism theory, liberalization, rather than reducing the degree of subordination of public authority to private capital, has only facilitated an enhanced degree of state capture.

WP2008/03: Exchange Rate Movement of Developing Countries: An Alternative Theoretical Framework, Atulan Guha, February 2008

Abstract: The role of foreign exchange reserves in explaining exchange rate behaviour has been neglected in exchange rate theories which either excluded these reserves as a determinant or treat them merely as a residual factor. However, while this may not be the case with currencies that have a reasonable amount of use as international money, foreign exchange reserve have been playing an important role in determining the nominal exchange rates of developing countries. This paper develops a theoretical framework, in heterodox tradition, for understanding exchange rate movements in developing countries by keeping foreign exchange reserve at the centre stage. The analysis also suggests that to avoid currency crises, developing countries need to restrict the movement of speculative capital.

WP2008/02: Crony Capitalism: Caricature or Category?, Surajit Mazumdar, February 2008

Abstract: This paper, the first in a series on Crony Capitalism and Contemporary India, examines the conceptual meaning of the term crony capitalism, which has acquired considerable popularity since it was used as an explanation for the East Asian crisis. The paper argues that the conception of crony capitalism as a description of a distinct kind of capitalism associated with the State playing a key role in the allocation process suffers from serious deficiencies and therefore does not provide a suitable framework for understanding the business-state interaction. While the phenomenon that is called cronyism is very real, it is widespread in modern capitalism and not a peculiar feature of capitalism characterized by a particular economic policy regime. In fact, crony capitalism may lie at the very heart of the contemporary global capitalist order, and this crony capitalism may explain why the concept of crony capitalism has acquired such prominence in recent times.

WP2008/01: Iron Foundries in Duress: Identifying Impediments in Organisations and Institutions, Satyaki Roy, January 2008

Abstract: Market-led reforms are assumed to be sufficient to fill up technology gaps and organisational inefficiencies in a way that small enterprises in developing countries could take the opportunities of higher growth and larger exports. With reference to a traditional cluster of small foundries in Howrah (West Bengal) this paper argues that increased competitive pressure does not necessarily lead to adequate adjustments. Responses of firms to increased competition are conditioned by non-market organisations and institutions that may not be favourable to attain competitiveness and do not adjust automatically to altered incentives.

 

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