This chapter shows how the perceived strategic value of high-tech, globally integrated sectors, represented by telecommunications, for neoliberal development interacts with sectoral structures and organization of institutions. The resultant regulated governance by the Indian government of telecommunications are the micro-institutional foundations of Indian-style capitalism undergirding the globalization and development of such industries disconnected from the post-Independence legacies of the Indian nationalist imagination. The cross-time sector and company case studies show the initial introduction of competition in telecommunications occurred during Big Bang Liberalization supported by pro-liberalization industrial stakeholders disconnected from the existing telecommunications bureaucracy. Today a central-level ministry makes policy and an independent regulator enforces the market entry and business scope of a state-owned fixed-line operator and fiercely competitive mobile carriers and value-added service providers. The role of the state in market coordination and the dominant property rights arrangements vary by subsector as a function of interacting strategic value and sectoral logics. Nehruvian interpretation of Gandhian Swadeshi self-reliance has retained bureaucratic oversight of the development of state- and privately-owned equipment makers, which concentrated on rural automatic exchanges and low-tech inputs until the dominance of Chinese competition pivoted focus to indigenous development in new generation mobile consumer and terminal telecommunications equipment.

This chapter demonstrates that the lower degree of and narrower scope of the perceived strategic value of labor-intensive, non-value-added sectors, represented by textiles, for national security and resource management, has shaped their decentralization beginning under Gorbachev’s perestroika. Mass privatization after Soviet breakdown further reenforced the private governance pattern dominant in apparel and clothing. The cross-time sector and company case studies disclose the interacting strategic value and sectoral logics and show apparel and clothing factories have shut down or privatized to former managers only to languish with antiquated equipment. Today, Russian textile and garment manufacturers are outcompeted by illegal imports from China and the Commonwealth of Independent States. Industrial and technical textile sectors, which incorporate oil and petrochemicals and higher technological intensity, in contrast, experience the state intervention from central and regional governments of decentralized governance in response to political and economic pressures, such as oil boom and bust cycles and Western sanctions in post-Crimea annexation. The central government has designated petrochemicals a critical input for chemical fiber processing and provides fiscal incentives to develop technical textiles. Local governments have worked with local and national oligarchs to revive factories and production lines, and courted foreign direct investment.

Beyond macroeconomic indicators and simple observations that China, India, and Russia are large and diverse developing countries shedding socialist economies, what is often overlooked is that these countries’ development trajectories are nationally distinct and sectorally variegated. The commonality of market liberalization in the context of their global economic integration has translated into very different pathways to development, revealing stark differences in micro-institutional foundations, which vary by sector. This book unravels the puzzles with three overarching claims. First, mediating the impacts of globalization and economic liberalization on industrialization are dominant nation-specific sectoral patterns of market governance. Market governance structures comprise two dimensions (level and scope of the state in market coordination and dominant distribution of property rights arrangements). The conceptualization recognizes the various state authorities and market actors in coordination mechanisms and broadens measures of institutional quality beyond de jure private property rights and credible commitment. Second, the values and identities of national political economic elites as they respond to objective political and economic pressures internal and external in nature interact with sectoral structures and organization of institutions. The resultant national configurations of sectoral models, the third claim of the book, negotiate global economic integration with impacts on actual development outcomes.

The Strategic Value Framework introduced in this chapter offers a unified explanation, linking macro- and micro-sectoral-level changes and continuities, of what appears to be contradictory and irreconcilable forces at work within globalizing countries. It first identifies historically and institutionally rooted values, objective and intersubjective in nature, which arise from state elite responses to political and economic pressures internal and external in nature experienced during significant moments of national consolidation. The perceived strategic value orientation evolves and transforms overtime; and interacts with sectoral structures and organization of institutions. The resultant dominant patterns of market governance vary by country and sector within country and filter the relative impacts of an open economy, global norms and international organizations, resource and factor endowments, regime type and political institutions, and national characteristics and domestic structures. The Strategic Value Framework is tested and substantiated with a multilevel comparative case research design, which systematically conducts across case and within case analysis at (time, country, sector, and company). The case studies leverage historical process-tracing and triangulation of qualitative and quantitative data, including in-depth interviews with state, subnational government, business, and industry stakeholders and primary and secondary documentation collected during extensive fieldwork.

This concluding chapter assesses the Strategic Value Framework for understanding the nonlinear and multidimensional nature of national sector-specific market pathways to development contrary to the expectations about the effects of open economy politics and regime type for particular modes of state-market interactions. The national configurations of sectoral models bridge different scholastic traditions in varieties of capitalism on the interactions between company-level and national-level characteristics and hierarchical state-business relations. Sector-specific dynamics emanating nation-specific sectoral pathways uncover how perceived strategic value and sectoral structures and organization institutions interact to affect how multinational and domestic companies alike experience the emergent institutional foundations of capitalism. This chapter further demonstrates how the new capitalisms play out in other strategic and non-strategic sectors in China, India, and Russia. The book concludes with analyzing the macro effects of the micro-institutional foundations on global conflict and cooperation—from trade wars and cross-border cybersecurity to the Covid-19 global pandemic. The analytical leverage of the Strategic Value Framework in identifying national sector-specific patterns of market governance sheds light on the politics of the management of the Covid-19 pandemic and how they varied across countries and industries within them.

This chapter exposes how the perceived strategic value of capital-intensive, value-added sectors, represented by telecommunications, for national security and resource management, interacts with sectoral structures and organization of institutions. The centralized governance by the Russian state since the collapse of the Soviet Union and further reenforced during the Putin era witnessed in these sectors shows the federal government consolidating in one corporate entity the ownership and management of civilian and dedicated landlines of the Soviet military industrial complex. Centralized market coordination presides over the predominantly privately owned mobile and value-added service providers operating in fiercely competitive markets deregulated in the 1990s. The cross-time sector and company cases further show various lower-level bureaucracies and non-sector-specific economywide rules regulate telecommunications equipment privatized after Soviet collapse, perceived less strategic than the state-owned and managed backbone infrastructure. Similar interacting strategic value and sectoral logics apply to Information Technology (IT) Software, a sector which has benefitted from former science and technology personnel of the Soviet defense industry. In the face of perceived security threats from within and without after economic crises and conflicts with neighboring countries, however, the state has reenforced its control of the information communications infrastructure, including RuNet and cybersecurity, designated strategic assets.

The Strategic Value Framework explicates the dominant sectoral patterns of market governance in India today. Historical process tracing from sectoral origins of labor-intensive textiles and capital-intensive telecommunication in this chapter shows how Indian state leaders intersubjectively respond to objective economic and political pressures. The political basis and evolution of the perceived strategic value of national self-reliance and neoliberal development are the successively elected governments’ interpretations of Independence legacies in response to external and sectarian conflicts and economic crises. The joined imperatives in the Emergency period through Big Bang Liberalization in the 1990s have profound implications for the Singh and Modi governments alike in 2004 and beyond. Interacting perceived strategic value and sectoral structures and organization of institutions shape the decentralized role of the state and the dominant distribution of public and private economic actors of regulated governance in high-tech, globally integrated sectors, such as telecommunications. The more centralized state coordination and numerically dominant small-scale industry and politically dominant business groups of centralized governance operate in more rural, labor-intensive sectors, such as textiles, associated with the nationalist imagination of Gandhian Swadeshiism. The dominant sectoral patterns of market governance have given rise to Indian-style capitalism of bifurcated liberalism shaped by neoliberal self-reliance.

This chapter shows how the perceived strategic value of high-tech, value-added sectors, represented by telecommunications services and manufacturing, for national security and the national technology base, interacts with sectoral structures and organizational of institutions, and shapes the Chinese government’s centralized governance. Two decades after accession to the World Trade Organization, the Chinese government has yet to implement many of its market entry and business scope commitments in telecommunications. The state governs telecommunications with centralized coordination by a supraministry of government-owned fixed-line and mobile carriers and privately-owned but government-controlled value-added service providers and equipment makers. The dominant pattern of centralized governance enables the state to achieve its security and developmental goals even while introducing competition and exposing the industry to global economic integration. The cross-time sector and company cases uncover how reregulation and deliberate state interventions in corporate governance and anti-trust followed the market liberalization in the 1990s and 2000s. From the development of network technologies, such as 5G, to semiconductors, Chinese state-owned institutional and firm-level initiatives have strategically courted foreign direct investment and reregulated to gain corporate control or force divestment. Similarly, foreign investment and private capital have developed value-added services; but subsequent reregulation controls information dissemination and sectoral development.

The Strategic Value Framework explicates the dominant sectoral patterns of market governance in China today. Historical process tracing from sectoral origins of labor-intensive textiles and capital-intensive telecommunication in this chapter shows how Chinese state leaders intersubjectively respond to objective economic and political pressures. The perceived strategic value of national security and national technology base took root during foreign interventions and internal upheavals from the Qing dynasty to Chinese Communism and the 1978 Open Door Policy and beyond. The joined imperatives interacting with sectoral structures and organization of institutions shape the central state coordination of predominately state-owned and state controlled economic actors of the centralized governance of strategic sectors with application for national security and contribution to the national technology base, represented by telecommunications. Contrary to open economy politics, this is reenforced after China joins the World Trade Organization and enhances authoritarianism under Xi Jinping. The decentralized governance and private governance characterized by market coordination by local governments and nonstate actors and variegated property rights arrangements of nonstrategic sectors, such as textiles, reveal the limits of regime type and state capitalism explanations. These dominant sectoral patterns have given rise to Chinese-style bifurcated capitalism shaped by techno-security developmentalism in China today.

INTRODUCTION

China’s dramatic transformation on both domestic and international fronts is redirecting not only its own but also the world economy. China’s push to position itself as a key global economic leader and to strengthen its influence in Asia is increasingly visible through various cooperation schemes such as the Greater Mekong Subregion Programme, the ASEAN-China Free Trade Area and the Regional Comprehensive Economic Partnership. China has become the primary export destination as well as the biggest source of imports for many countries in the region. Importantly, China’s growing purchasing power and sustained rapid expansion present vast opportunities for Thailand to expand its trade with China.

Indeed, Thailand’s trade with China has grown markedly in the past two decades. The value of Thailand’s exports to China increased from around US$1.7 billion in 1998 to almost US$30 billion in 2017, about 20 per cent of which was accounted for by agricultural exports. Further, the share of agricultural exports in total exports to China is the highest among major markets such as ASEAN, the European Union and the United States. Thailand’s agricultural exports to China are concentrated in only a few products, however. In particular, exports of cassava and durian to China have grown steadily over the past years, which is why they were selected for value chain analysis.

Despite the rise in agricultural exports to China, Thai exporters still face various non-tariff measures (NTMs) from China. Thai jasmine rice exporters, for example, face quota restrictions and other sanitary and phytosanitary (SPS) requirements (Phanishsarn 2018). Longan exporters must also comply with SPS measures, which require longan growers to have at least good agricultural practices certification (Hasachoo and Kalaya 2013). While many NTMs are in place to protect human and animal health, some are seen as discriminatory measures to restrict trade. Understanding the NTMs facing actors in agricultural value chains is important for boosting agricultural exports to China.

This chapter analyses durian and cassava value chains in Thailand and identifies challenges for stakeholders at different stages of the chains. The study also reviews NTMs imposed by both Thailand and China on durian and cassava exports. Various types of information were collected from desk research as well as focus group discussions and key informant interviews.

INTRODUCTION

Myanmar shares land borders with China, India, Laos and Thailand. Given this strategic location, the country plays an important role in facilitating trade between China and other Greater Mekong Subregion countries. Myanmar’s trade with China expanded rapidly between the 1990s and the 2010s when the country was still subject to economic sanctions imposed by the United States and the European Union. In 1991–93, China’s share of Myanmar’s trade stood at 24.3 per cent compared to 10 per cent each for the United States and the European Union. At that time, Myanmar traded mostly within the ASEAN region, which accounted for 42.3 per cent of Myanmar’s total trade. By 2011–13, China had become Myanmar’s largest trading partner with a 39 per cent share of total trade, while ASEAN’s share had fallen to just under 29 per cent, and the United States and the European Union each had just 3 per cent.

Although Myanmar continued to rely on natural gas as the main export commodity to Thailand and China, the share of agriculture trade with China rose rapidly in the last ten years. Myanmar’s export portfolio with China mainly consists of raw and unprocessed agricultural products such as rice, beans and pulses, fruit and vegetables, maize, rubber and fishery products. About one-fifth of total agricultural exports are transported overland through cross-border trade to China, though a considerable share of this trade is informal. Here, informal trade refers to trade in processed or non-processed goods considered legal exports on the Myanmar side but illicit imports on the China side. This informal trade represents a massive loss of revenue for Myanmar in value-added and employment opportunities along agricultural value chains. The major bottlenecks behind such imbalance are created by the lack of national quality infrastructure at main border checkpoints and the dominance of informal trade highly susceptible to administrative border control measures. Added to this, the prevalence of non-tariff measures (NTMs) on the China side, and the lack of institutions and infrastructure to certify the quality of agricultural produce on the Myanmar side, are the underlying causes of this informal trade and its negative effects on smallholders.