India’s economic buoyancy stretches far beyond the realm of the country’s family-owned business empires, writes Gordon Mathews
Readers of India Business Law Journal are bombarded by news of billion-dollar deals closed by large enterprises and family-owned conglomerates in India, and may envision an Indian business world that consists primarily of the Tatas, Ambanis, Bhartis, and Mahindras. These groups and other business houses are extraordinarily important to India’s blossoming economy; but miles below their endeavours lie another calibre of businesspeople who matter equally.
I have spent much time in Hong Kong’s Chungking Mansions, a building of guest houses and small businesses teeming with over 4,000 people, many of whom are migrant workers from South Asia and Africa.
I have talked to people from Kolkata who work for low wages for as long as their entry permits allow them to stay and return home to India every 42 days, lugging suitcases filled with packs of China-made clothing weighing 30 kilogrammes or more. Carrying this clothing largely pays for their flights between Hong Kong and Kolkata, generally via Biman Bangladesh Airlines. Hundreds like them bring clothing into India, purchased for less than locally made clothing would cost.
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I have also spent months with Indian and Pakistani merchants in Chungking Mansions, discussing with them their trade in mobile phones. A total of 100 or so mobile phone stalls supply African traders with cheap, used, sometimes copy mobile phones that constitute roughly 20% of all the phones in use today in sub-Saharan Africa, I estimate.
These people are engaged in what I call low-end globalization. Today, most of the world’s people don’t see the high-end globalization of transnational corporations with their billion-dollar budgets and batteries of lawyers.
Instead, they see the low-end globalization of traders buying used or copy merchandise under the radar of the law and transporting these goods across continents and past borders, to be sold by street vendors at minimal prices with no questions asked. This is business without lawyers and copyrights, run through skeins of personal connections and wads of cash. If we want to understand how globalization really works in the world today, we need to take low-end globalization as seriously as we take high-end globalization.
Many of those involved in high-end globalization believe otherwise. Consider copy goods, or piracy, a key element of low-end globalization. Anti-piracy organizations in various countries, responding to the interests of large global companies, lobby their governments for harsh penalties against pirated goods and campaign to criminalize such production.
These organizations promote the idea that the consumption of copies is financing contraband, theft and even narcotics trafficking. They argue that people who buy pirated goods are destroying legal businesses, leading to fewer job openings, personnel cuts, and technological stagnation.
Beyond this, they claim that the activities of low-end globalization bleed states of much-needed tax revenues. They also say consumers who buy copy products that they believe are genuine feel cheated and dismayed when these products quickly stop working, as they often do.
But one could also argue that low-end globalization solves problems that high-end globalization cannot, in providing employment, income, and a capacity to acquire goods trumpeted in the media that the poor otherwise could not afford.
A Kenyan trader in Hong Kong buying China-made goods told me: “Nobody in my country can buy an original brand of suit, or an original phone by a famous company. It’s too expensive. We traders are bringing the world to Africa. We are bringing home goodness!”
Companies like Nokia and Samsung officially proclaim their total opposition to copy goods, hiring lawyers and undercover detectives to find and prosecute those who produce and sell such goods. But off the record, employees of these companies have told me that their employers recognize the high levels of consumer awareness. Those who purchase copies know full well they are not getting the original.
The buying of copies is usually aspirational. Many think, “Today I can only afford a copy of this Nokia model, but in a few years, I want to be rich enough to buy a genuine Nokia.” In this sense, real and copy goods may complement one another, the copy feeding the desire for the genuine article. Yes, copy goods represent an infringement of intellectual copyrights. However, to the extent that these goods serve as a stepping-stone rather than a substitute for genuine goods, perhaps this not so contemptible.
The factories of Guangdong province in China are the major world supplier of the goods of both high- and low-end globalization. Perhaps when the economic history of the early 21st century is written, China will be celebrated not for its contributions to big business, but rather for enabling the poorer consumers of the developing world to sample, for the first time, the goods of globalization – even if those goods are used, copied, or otherwise flawed.
As for the Indian, Pakistani, and African traders who undertake such trade in their world travels – they are contemporary Marco Polos, spreading the otherwise inaccessible goods of China to developing-world consumers. And who can honestly say that this is a bad thing?
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Gordon Mathews is a professor in the Department of Anthropology at the Chinese University of Hong Kong and the author of Ghetto at the Center of the World: Chungking Mansions, Hong Kong.
