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I use to think it was narcissism of small differences, Sino-sphere cultures hating on each other but from what I hear in Vietnam, they're jerks to everyone. Eve

I use to think it was narcissism of small differences, Sino-sphere cultures hating on each other but from what I hear in Vietnam, they're jerks to everyone. Even PRC firms in Viet did not seem to have _that_ bad of reputation to work for. > India System Does lobbying power from Tata or Adani influence over said politics? Seems like they have competence and connections to take over failed foreign ventures. Not implying it's coordinated, but domestic players have a lot to gain. And probably better cultural experience to run these operations after capital is setup in country. I imagine Indian chaebols have more ability to control unrest, vs in PRC tight relationship with Foxconn essentially delegates crowd control to compliant local govs. >breakdown by nationality This is first article I found: https://www.deccanherald.com/business/business-news/why-mncs-are-quitting-india-1119422.html https://www.deccanherald.com/business/business-news/why-mncs... >A slew of big names including German retailer Metro AG, Swiss building-materials firm Holcim, US automaker Ford, UK banking major Royal Bank of Scotland, US bikemaker Harley-Davidson and US banking behemoth Citibank have chosen to pull the plug their operations in India or downsize their presence here in recent years. I think SKR took over the GM plant. I'm pretty sure JP expansion in India stalled last few years during covid but reporting last few months seems like SKR + JP is going to give it another go. If they can make it work long term, and hopefully they can, good on them.

alephnerd 3y ago
> from what I hear in Vietnam, they're jerks to everyone. It seems like the older generation of Taiwanese who came to age in the 70s and 80s have a bit of a superiority complex over the rest of poor Asia. Tbf, Koreans and Japanese do as well (Korean and Japanese investors in ASEAN are total sleezeballs in my experience), but due to manpower constraints they at least try to develop local institutional capacity, while Taiwanese companies could always resort to hiring from within the PRC or the ASEAN Chinese diaspora. > Does lobbying power from Tata or Adani influence over said politics? Business lobbying within India is similar to that which happens in PRC. The same way you'd have local companies that are indirectly connected to local prefecture leaders (eg. The entire Construction industry within China), a similar thing exists in India. That said, a lot of this is highly dependent on industry. High Value Sectors such as Pharmaceuticals, ICT, Petrochemicals, Automotive, Banking, and Green Technology can largely bypass all the local lobbying bullshit because the state and federal regulators for those tend to have domain experience because of 40-50 years of regulatory harmonization thanks to guidance from Japan (via the ADB), US (via the WB and Diaspora Academics), SK (via Look South), Israel (mostly under the radar but Israeli advisors are pretty prominent within Indian policymaking circles), and Australia (Australia 2035). That said, the industries listed above tend to not hire as much. In labor heavy industries such as low skilled manufacturing, assembly, agriculture, construction, mining, etc you will face an extreme amount of lobbying and backroom dealing due to how heavily dependent such industries are to local laws and regulations, and also because they directly impact actual voters, plus direct action is a very common occurrence (often with tacit support from the local opposition - could be from any party be it BJP, INC, AAP, etc). That said, this happens A LOT in China as well, it just isn't noticed in English media because any coverage of such events would be in Mandarin and on Chinese platforms such as Weibo, WeChat, Douyin, etc, while Indian coverage surrounding labor strife will occur in English on western platforms like FB, IG, etc. Tl;dr - in my experience institutional and business norms in the PRC and India are actually pretty similar. In some cases, Chinese regulation is better than Indian ones but in other cases Indian regulations trump Chinese ones (VERY industry dependent) > US automaker Ford, UK banking major Royal Bank of Scotland, US bikemaker Harley-Davidson and US banking behemoth Citibank have chosen to pull the plug their operations in India or downsize their presence here in recent years. The US companies mentioned are divesting because there's an ongoing trade war between India and US (US wants India to open the agriculture sector to American imports, Indian politicians obviously don't want that as it undermines a critical voting block). This has lead to "India applied retaliatory tariffs of an additional 10% to 25%" on American goods [0]. There is a similar trade war going on with the UK as well. Japan, South Korea, Australia, and Singapore on the other hand have implemented free trade agreements with India years ago and Israel+France have had economic pacts since the early 2000s, so unsurprisingly it's MNCs from these countries that tend to have an oversized impact in India (though within the ICT sector American companies still remain strong because of the point I made above). In my experience, Japanese involvement hasn't really stopped in India (in fact it seems to keep growing). It's just not visible if you don't work in infrastructure - Japanese MNCs tend to dominate in Green Tech and Infrastructure projects such as the highway system, hydrogen cell R&D, automotive, and the train electrification project (already at 80% due to Pandemic era construction). Whenever I'd visit India, I'd often see highways with signs saying "Built courtesy of grants from the Government of Japan". This isn't to say that doing business as an MNC in India is easy - it isn't - but if you follow the right path (for example, make a Singapore, Mauritius, or UAE based corporation that has a majority ownership stake of the Indian subsidiary) it's not as difficult. Most Asian countries have done that for FDI within India, but less adept American companies seemed to have a preference and more experience with running operations from HK instead of SG. What HK is to PRC, that's what SG, Marutius, and UAE are to India. [0] - https://sgp.fas.org/crs/row/IF10384.pdf https://sgp.fas.org/crs/row/IF10384.pdf
- dirtyid 3y ago
  Thanks for the insightful write up. I was aware of the IN-US trade war, but I thought American companies would ultimately suck it up like they did in PRC where US goods like vehicles got slapped by heavy duties. PRC agri sector is also protected for national security and to keep 100s millions employed, not a voting block, but similar political considerations. Also won't buy US modified seeds. But they do buy a ton of bulk agri products, and farm equipment... when not sanctioned. Seems weird so many divested from India under similar circumstances. Mom and pop India farmers not buying enough John Deere or something? Indian consumers not projected to eat enough meat / buy enough US animal feed? New American attitude to trade? Or US lack of adeptness you mentioned?
  - alephnerd 3y ago
    > but I thought American companies would ultimately suck it up like they did in PRC where US goods like vehicles got slapped by heavy duties The ones with an actual India thesis+strategy have a Singapore subsidiary that owns the India operation, hire local operations, and also have some sort of a competitive edge. The companies listed in the article such as Harley-Davidson and Citibank were very late entries (late 2000s and early 2010s) in very competitive and mature industries (Motorbikes and Banking), and had negative reputations (bad quality at the price point w/ Harley-Davidson and Ford, part of banking scandals w/ regards to Citibank ans RBS A good example of a foreign company actually succeeding is John Deere India - they worked on building a strong local operation with local staff and training in the 1990s, and now John Deere is one of the major agtech brands in India, and the India operation is used in turn to export John Deere products to other parts of South Asia, ASEAN, MENA, and East Africa. In India, being an American brand isn't enough of a differentiator, simply because by the time American companies began entering the India market in the late 90s/early 2000s, Japanese, Korean, and European (French+Italian) corporations such as Suzuki, Daewoo, Honda, Unilever, etc had an established presence and 30-50 years of India operations knowledge. When India forced American companies to divest in the late 1970s, the Indian government invited Japanese, Korean, Italian, and French companies to help manage those nationalized companies and make 50-50 Foreign-Local partnerships. (Btw, those same American companies that were kicked out of India in the 1970s moved operations to a newly opening developing market called the People's Republic of China). That's why you companies like Honda, Suzuki, Daewoo, Fiat have/had a massive presence in India but American companies outside of High Value industries don't. In China in the same period on the other hand, American brands were invited with open arms so it was much easier for them to establish a presence as there wasn't as much competition, whereas India in the 70s/80s/90s already had established European, Japanese, and Korean competitors. This is starting to change since the 2010s, but will take some time as you need a Singapore operation, and most junior American companies have used a HK one. > they do buy a ton of bulk agri products, and farm equipment... when not sanctioned A lot of American agtechs entering the Indian market are competing with Israeli, French, Italian, Japanese, and Indigenous companies. Israeli, French, Japanese, and Italian agtech R&D is quite strong, especially when dealing with water constrained agriculture (like a large portion of India is) plus companies in those countries are fine knowledge transferring to India (Indian corporations will manufacture and repair the previous generation model, while the French/Israeli/Italian/Japanese company sells the latest and greatest). And India has always had a strong indigenous Agtech R&D capacity, which has allowed Indian companies to become competitors of American companies as well. For example, in Ethiopia 70% of all land acquired by Foreigners since 2008 was by Indian corporations [0] until Ethiopia nationalized Indian companies land grants in 2017. Similar stories exist across Eastern Africa such as Tanzania, Mozambique, Kenya, etc. Also, American trade relations with India have grown leaps and bounds better since 2019, due to regulatory harmonization as well as American companies increasingly leaving China due to similar pressures that American companies faced in India in the 70s and 80s. [0] - https://theconversation.com/the-lesser-known-story-of-indias-role-in-ethiopian-land-deals-42432 https://theconversation.com/the-lesser-known-story-of-indias...

alephnerd 3y ago

> from what I hear in Vietnam, they're jerks to everyone. It seems like the older generation of Taiwanese who came to age in the 70s and 80s have a bit of a superiority complex over the rest of poor Asia. Tbf, Koreans and Japanese do as well (Korean and Japanese investors in ASEAN are total sleezeballs in my experience), but due to manpower constraints they at least try to develop local institutional capacity, while Taiwanese companies could always resort to hiring from within the PRC or the ASEAN Chinese diaspora. > Does lobbying power from Tata or Adani influence over said politics? Business lobbying within India is similar to that which happens in PRC. The same way you'd have local companies that are indirectly connected to local prefecture leaders (eg. The entire Construction industry within China), a similar thing exists in India. That said, a lot of this is highly dependent on industry. High Value Sectors such as Pharmaceuticals, ICT, Petrochemicals, Automotive, Banking, and Green Technology can largely bypass all the local lobbying bullshit because the state and federal regulators for those tend to have domain experience because of 40-50 years of regulatory harmonization thanks to guidance from Japan (via the ADB), US (via the WB and Diaspora Academics), SK (via Look South), Israel (mostly under the radar but Israeli advisors are pretty prominent within Indian policymaking circles), and Australia (Australia 2035). That said, the industries listed above tend to not hire as much. In labor heavy industries such as low skilled manufacturing, assembly, agriculture, construction, mining, etc you will face an extreme amount of lobbying and backroom dealing due to how heavily dependent such industries are to local laws and regulations, and also because they directly impact actual voters, plus direct action is a very common occurrence (often with tacit support from the local opposition - could be from any party be it BJP, INC, AAP, etc). That said, this happens A LOT in China as well, it just isn't noticed in English media because any coverage of such events would be in Mandarin and on Chinese platforms such as Weibo, WeChat, Douyin, etc, while Indian coverage surrounding labor strife will occur in English on western platforms like FB, IG, etc. Tl;dr - in my experience institutional and business norms in the PRC and India are actually pretty similar. In some cases, Chinese regulation is better than Indian ones but in other cases Indian regulations trump Chinese ones (VERY industry dependent) > US automaker Ford, UK banking major Royal Bank of Scotland, US bikemaker Harley-Davidson and US banking behemoth Citibank have chosen to pull the plug their operations in India or downsize their presence here in recent years. The US companies mentioned are divesting because there's an ongoing trade war between India and US (US wants India to open the agriculture sector to American imports, Indian politicians obviously don't want that as it undermines a critical voting block). This has lead to "India applied retaliatory tariffs of an additional 10% to 25%" on American goods [0]. There is a similar trade war going on with the UK as well. Japan, South Korea, Australia, and Singapore on the other hand have implemented free trade agreements with India years ago and Israel+France have had economic pacts since the early 2000s, so unsurprisingly it's MNCs from these countries that tend to have an oversized impact in India (though within the ICT sector American companies still remain strong because of the point I made above). In my experience, Japanese involvement hasn't really stopped in India (in fact it seems to keep growing). It's just not visible if you don't work in infrastructure - Japanese MNCs tend to dominate in Green Tech and Infrastructure projects such as the highway system, hydrogen cell R&D, automotive, and the train electrification project (already at 80% due to Pandemic era construction). Whenever I'd visit India, I'd often see highways with signs saying "Built courtesy of grants from the Government of Japan". This isn't to say that doing business as an MNC in India is easy - it isn't - but if you follow the right path (for example, make a Singapore, Mauritius, or UAE based corporation that has a majority ownership stake of the Indian subsidiary) it's not as difficult. Most Asian countries have done that for FDI within India, but less adept American companies seemed to have a preference and more experience with running operations from HK instead of SG. What HK is to PRC, that's what SG, Marutius, and UAE are to India. [0] - https://sgp.fas.org/crs/row/IF10384.pdf https://sgp.fas.org/crs/row/IF10384.pdf

dirtyid 3y ago
Thanks for the insightful write up. I was aware of the IN-US trade war, but I thought American companies would ultimately suck it up like they did in PRC where US goods like vehicles got slapped by heavy duties. PRC agri sector is also protected for national security and to keep 100s millions employed, not a voting block, but similar political considerations. Also won't buy US modified seeds. But they do buy a ton of bulk agri products, and farm equipment... when not sanctioned. Seems weird so many divested from India under similar circumstances. Mom and pop India farmers not buying enough John Deere or something? Indian consumers not projected to eat enough meat / buy enough US animal feed? New American attitude to trade? Or US lack of adeptness you mentioned?
- alephnerd 3y ago
  > but I thought American companies would ultimately suck it up like they did in PRC where US goods like vehicles got slapped by heavy duties The ones with an actual India thesis+strategy have a Singapore subsidiary that owns the India operation, hire local operations, and also have some sort of a competitive edge. The companies listed in the article such as Harley-Davidson and Citibank were very late entries (late 2000s and early 2010s) in very competitive and mature industries (Motorbikes and Banking), and had negative reputations (bad quality at the price point w/ Harley-Davidson and Ford, part of banking scandals w/ regards to Citibank ans RBS A good example of a foreign company actually succeeding is John Deere India - they worked on building a strong local operation with local staff and training in the 1990s, and now John Deere is one of the major agtech brands in India, and the India operation is used in turn to export John Deere products to other parts of South Asia, ASEAN, MENA, and East Africa. In India, being an American brand isn't enough of a differentiator, simply because by the time American companies began entering the India market in the late 90s/early 2000s, Japanese, Korean, and European (French+Italian) corporations such as Suzuki, Daewoo, Honda, Unilever, etc had an established presence and 30-50 years of India operations knowledge. When India forced American companies to divest in the late 1970s, the Indian government invited Japanese, Korean, Italian, and French companies to help manage those nationalized companies and make 50-50 Foreign-Local partnerships. (Btw, those same American companies that were kicked out of India in the 1970s moved operations to a newly opening developing market called the People's Republic of China). That's why you companies like Honda, Suzuki, Daewoo, Fiat have/had a massive presence in India but American companies outside of High Value industries don't. In China in the same period on the other hand, American brands were invited with open arms so it was much easier for them to establish a presence as there wasn't as much competition, whereas India in the 70s/80s/90s already had established European, Japanese, and Korean competitors. This is starting to change since the 2010s, but will take some time as you need a Singapore operation, and most junior American companies have used a HK one. > they do buy a ton of bulk agri products, and farm equipment... when not sanctioned A lot of American agtechs entering the Indian market are competing with Israeli, French, Italian, Japanese, and Indigenous companies. Israeli, French, Japanese, and Italian agtech R&D is quite strong, especially when dealing with water constrained agriculture (like a large portion of India is) plus companies in those countries are fine knowledge transferring to India (Indian corporations will manufacture and repair the previous generation model, while the French/Israeli/Italian/Japanese company sells the latest and greatest). And India has always had a strong indigenous Agtech R&D capacity, which has allowed Indian companies to become competitors of American companies as well. For example, in Ethiopia 70% of all land acquired by Foreigners since 2008 was by Indian corporations [0] until Ethiopia nationalized Indian companies land grants in 2017. Similar stories exist across Eastern Africa such as Tanzania, Mozambique, Kenya, etc. Also, American trade relations with India have grown leaps and bounds better since 2019, due to regulatory harmonization as well as American companies increasingly leaving China due to similar pressures that American companies faced in India in the 70s and 80s. [0] - https://theconversation.com/the-lesser-known-story-of-indias-role-in-ethiopian-land-deals-42432 https://theconversation.com/the-lesser-known-story-of-indias...