|dc.description.abstract||In the context of globalisation and liberalising economies, an increasing number of local firms
based in developing countries and emerging markets are encouraged to internationalise their
business activities and thus participate in foreign trade. Their sustained success is founded on
two key factors; their ability to access potential foreign markets, and their ability to upgrade their
capabilities and thus improve their positioning in global markets. This thesis investigates the
internationalisation process and upgrading prospects of Indian Garment Manufacturers (IGMs).
It begins by examining how IGMs gain access to foreign markets and discusses the factors that
help or hinder their progress. The thesis subsequently explores the ways in which IGMs upgrade
their activities to higher value-added activities and investigates the contributory factors that drive
and shape their upgrading prospects.
Existing studies employ the concept of ‘Diaspora networks’ or ethnic ties to explain how local
firms from emerging markets are able to internationalise their business activities. These studies
highlight the integral role played by Diaspora networks in enabling this internationalisation.
Diaspora networks help connect local firms with foreign, world class buyers (or ‘lead firms’)
using the Diaspora’s own pre-established ties and links with such lead firms. Similarly, Global
Value Chain (GVC) proponents assume the upgrading prospects of these local firms can be
enhanced as a result of linking up with ‘lead firms’ because of the benefits that can be derived
from knowledge and technology transfer imparted through working with world class buyers.
The extant literature however is vague on the internationalisation processes of IGMs.
Furthermore, it does not adequately address the extent to which IGMs utilise Indian Diaspora
networks to access foreign markets and to internationalise their business activities. It is also
unclear what mechanisms are employed to impart knowledge from lead buyers to suppliers and
to what extent the knowledge and technology transferred plays a key role in progressing IGMs
upgrading activities; especially in the higher value added functions of design. This thesis
contributes by addressing and shedding further light on these unresolved issues. It examines the
issues using a combined approach, where theories and concepts from international business (IB)
and GVC are employed in analysing the subject matter and thus allows for a more nuanced and
comprehensive understanding of the issues under investigation.
To explore the above themes a case study based approach was employed. Interviews were
conducted with key decision makers/owners of 23 case companies. Further interviews with key
industry, academic and government heads were conducted as a means of triangulation.
Interviews were, in turn, supplemented with documentary evidence and published material from
company websites, industry and academic journals, and newspaper articles, so as to arrive at a
more comprehensive understanding of the issues in question.
Findings from this study suggest that IGMs rarely use Diaspora networks to access foreign
markets. Instead, the majority of IGMs have achieved internationalisation as a result of well-developed
networks of formal intermediaries based in India who have facilitated connections
with prospective buyers. Furthermore, their manner of internationalisation reveals IGMs tend to
access foreign markets initially at a very young age and at a rapid pace. Thus process-based
theories of internationalisation seem inappropriate in explaining this rapid pace of
internationalisation; insights from the literature on Born Globals and International New Ventures
(INVs) seem, at first, to offer better explanations. However, employing concepts such as the
‘mature’ born global and the ‘failed’ born global leads one to re-examine and reconsider these
initial findings. Re-examined findings indicate that in fact maturing IGMs are realigning their
internationalisation trajectories to be better positioned to take advantage of favourable domestic
market conditions. These findings are better explained using a more inclusive definition of
internationalisation; particularly, concepts of de-internationalisation and extra-regional
expansion from the field of IB.
Additional findings, related to the issue of upgrading, indicate that contextual factors, usually
related to the domestic economy and the firm’s internal circumstances, play a significant role in
affecting the upgrading prospects of IGMs. These findings are contrary to GVC-based
explanations of what drives and shapes IGMs’ upgrading activities, which place excessive
emphasis on the role of the ‘lead firm’. In particular, GVC-based assumptions regarding the
knowledge and technology transfer benefits available to local manufacturers by linking with
larger world class buyers or lead firms seem of limited applicability to IGMs; here, firm-specific
factors seem more important in determining firm choices concerning upgrading trajectories.||en_US