Tom Barnes, Making Cars in the New India: Industry, Precarity and Informality

Abstract

Abstract. With the ongoing process of industrial tariff reforms across the globe, several developing countries in recent period are eying manufacturing sector consolidation, propelled by multiple motives. On one hand, joining the ever-expanding international production networks (IPNs) and global value chains (GVCs) has come up as a major motivation. On the other hand, particularly for the densely populated nations, employment creation and skill formation in the local labour market emerged as an important policy objective. In both set of options, attracting foreign multinational corporations (MNCs) to invest at ‘home’ emerged as a crucial strategy. The MNCs can be attracted on one hand through a ‘positive’ approach, e.g., reforms in ease of doing business, presence of a vibrant production cluster, availability of key raw materials,efficiency of in and outbound logistics, trade agreements with other countries and export opportunities and so on.The ‘negative’ approach may involve a weaker environmental regulatory framework (Pollution Haven Hypothesis), compromise on labour standard etc.

Keywords. Industry, Precarity, Informality, Car industry, India.

JEL. F34, F43, F63, C01.