A Quest for the Presence of Financialization in the Global South The Case of India

Abstract

The globalized world is witnessing increasing dominance of the financialization of the economy and society. A rapidly changing association among finance capitalists, individuals, the economy, geography, and society, with financialization at the center of these relationships, has been observed recently. However, existing research on this subject is primarily concentrated on advanced capitalist economies of the Global North. As global finance is penetrating the Global South as well, there is a necessity to understand the features, nuances, and theoretical debates surrounding financialization in the context of countries from the Global South. A comprehensive review of the literature reveals that studies on financialization exhibit unsettled and inconclusive debates in relation to the genesis, characteristics, causes, and consequences of the phenomenon. In the case of India, it is particularly difficult to establish strong evidence on the financialization of the Indian economy since the macro-evidence of financialization is not robust in comparison to evidence from the developed capitalist economies in the Global North. However, some recent microstudies have cited traces of financialization in microfinance, manufacturing firms, and digital banking in India. This micro-evidence, despite being a sector-specific
phenomenon, is crucial to the larger debate on financialization. This article argues that in cases of blurred features of financialization, macro-findings may not be completely reliable or even relevant. A better approach is to collate both macro- and micro-data and contextualize the findings in specific contemporary socioeconomic structures.