Urban geographies of financial convergence: situating Indian financial centres across global production and financial networks
With Dariusz Wójcik and Michael Urban
Published in Economic Geography.
2023-05-25
Abstract
Recent advancements in the global production networks (GPN) literature seek to better emphasise the role of finance by identifying where and how global financial networks (GFNs) intersect with GPNs. Financial centres operate as key sites for articulating financial convergence, understood as the merging of financial and non-financial sectors enacted by cross-sectoral investments. Yet, how such entanglement both feeds upon and impacts inter-city networks, affecting metropolitan hierarchies, remains largely overlooked. Using a novel dataset of 12,147 inter-sectoral, cross-border and domestic merger and acquisition (M&As) deals involving finance and insurance firms throughout the period of 2000-2020, this paper unpacks the sectoral dynamics that underpin the intersection of GFNs with GPNs at the city level in India, the 5th largest economy in the world. Our longitudinal and multiscalar analysis demonstrates how uneven patterns of financial convergence, structured around the rising entanglement between finance and IT, have reshaped inter-city networks and affected the landscape of financial centres in India. If Mumbai remains India’s financial capital, Bangalore and New Delhi gained power in domestic and international flows, well ahead of other Indian cities. The paper emphasizes how the IT firms, as recipient of transnational investments, and central governments, through direct interventions and state-hybrid investors, operate as key drivers in articulating GFNs with GPNs through inter-city networks, changing urban geographies of finance, raising methodological and conceptual questions for future research on financial geography.