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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

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...
- dirtyid 3y ago
  Again thanks for taking the time. No follow up questions!

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...

dirtyid 3y ago
Again thanks for taking the time. No follow up questions!