Campus Life

It’s a Big, Big World

Foreign Direct Investment for Whom?

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This is one example of office space built for IT companies, both international and domestic.
Diana Jue—The TEch
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New luxury condominiums being built at the fringes of the city serve as homes for Bangalore’s IT workers.
Diana Jue—The Tech

Near the end of my six weeks in Bangalore, I was seriously craving American food. Masala dosas, curries, rice, vegetables, and limited amounts of chicken created a healthy diet, but at times I desired a big, juicy burger. I hate to admit it, but to get that fix of junk food I hopped an auto rickshaw to the McDonald’s on Brigade Road, a shopping mecca for trendy Bangaloreans and foreigners. Although I settled for a Filet-O-Fish, the familiarity of being inside a McDonald’s was almost comforting, albeit strange. Here I was, an American halfway around the globe, savoring a sandwich that tastes exactly like one I could’ve picked up at the McDonald’s down Massachusetts Avenue.

Although the urban poor lived in the cities I visited, by no means were these cities devastated. In 2005, they all ranked in a listing of the top 150 richest cities (see table). Much of this wealth comes from foreign direct investment — investment made outside of the investor’s economy. Although the golden arches have become the icon for economic globalization, McDonald’s isn’t the only company that has gone global. Scattered among the clothing, electronics, and coffee shops on Bangalore’s Brigade Road were a Levi’s, Citibank, Puma, Adidas, Sony, Kentucky Fried Chicken, and Pizza Hut. Of the countries I visited, India had the least amount of foreign investment in retail and food. On my tourist map of urban Beijing, I counted 72 McDonald’s icons. KFC joints are favored local landmarks.

Technology has created advantages for companies to buy IT and BPO (business process outsourcing, which includes tasks like payroll) services from other companies in developing nations. Skilled labor is cheap, and the time difference promotes a 24-hour production schedule. This is particularly true in Bangalore, which is known as the “Silicon Valley of India.” In 1988, Texas Instruments, the first US multinational company to enter India, settled in Bangalore. 78 percent of the world’s chip design occurs there, and the city exports nearly $13 billion USD worth of IT-related products.

My class visited the office of Brickwork India, a marketing research firm that calls itself the “Gateway to the Best of India.” It was located on Bannerghatta Road, where some 70,000 IT-related workers were employed. On the way to the office, we passed mega-complexes boasting famous names: Dell, IBM, Oracle, and Accenture. At Brickwork India, we settled in cozy office chairs and watched Bangalore’s promotional video that highlighted the city’s cosmopolitan aspects, its 125 engineering colleges, and government-supported technology parks received $3.5 billion USD for infrastructure.

I watched the video in awe and disbelief. Bangalore’s technological capacities were astounding, but the Bangalore that the CEOs were describing in the video didn’t match Bangalore that I was experiencing. Cosmopolitan? The previous weekend, I went with my host father, Prabhakara, to pick out a live chicken from a coop that was sitting on our neighborhood sidewalk. Evening blackouts were common in our middle-class neighborhood. Prabhakara, who hated the dark, kept candles and matches in convenient locations.

Fortunately, I did have the opportunity to see the Bangalore that the video claimed during my stay. My host sister, Swetha, worked at Accenture. One evening, I rode with my family to pick her up from work. Although it was dark, the well-lit driving paths illuminated the differences between technology parks and the rest of Bangalore. The park was spacious, had wide and smooth driving lanes, manicured greenery, enormous new buildings, and large parking lots. The neighborhood I lived in had bumpy roads and small buildings crammed next to each other. On another class trip, I visited Whitefield, an IT neighborhood in east Bangalore that grew out of small villages at the city’s fringe. The neighborhood’s gated communities were often pitched as “lifestyle enclaves.”

In Buenos Aires and Shanghai, developments stemming from foreign direct investment had similar effects of uneven wealth distribution. The old port area along the Rio de la Plata was redeveloped by local and foreign investment to create Puerto Madero in the 1990s. It is a clean, attractive, and quiet area that draws international clients while remaining physically separated from the rest of the city via a waterway. Shanghai’s Pudong New Area is located on the banks of the Huangpu River. The finance and trade zone is home to the Oriental Pearl Tower and Jin Mao Tower, which are symbols of Shanghai’s economic development. Shanghai’s Xintiandi is an adaptive reuse development that created a classy entertainment district from old residential housing. It is a popular ex-patriot hangout that is far too expensive for most locals buy into.

I cannot say that I found foreign direct investment’s physical forms to be completely repulsive. Sure, they felt a bit sterile. But as an American, I felt that the developments released an air of familiarity that, although not particularly pleasing, was normal to me. I can understand why these places attract investors.

What was most bothersome was the developments’ overt, immensely concentrated wealth that seemed out of place in cities where citizens obviously lacked funds. The developments also diminished the cities’ public spaces, which lessened opportunities for inter-class interaction and further decreased visibility of the urban poor. There seems to be little initiative to close the income gap within the cities.

I’m still thinking: How will such disparities be addressed? How do foreign direct investment and these new developments alter how we understand cities, citizenship, and provision for citizens? What is a city, and how can today’s global economy fulfill all of its needs?