ABSTRACT
Industrial clusters in developing countries are increasingly linked to the global production networks. Inclusion in such networks provides greater scale and scope economies to firms and helps release the demand constraint, if any, that firms face in the domestic market. There is no denying that in large countries such as India export targeting cannot be a sustainable strategy if it is not supported by a corresponding expansion of the home market. However in the supply side it is often assumed that an expansion in exports generates significant spillover effects on domestic producers. In the preceding chapter export linkages did influence the growth process in Tiruppur, and not only the exporters per se but a vast network of subcontracting firms grew out of this export market. In this chapter, however we posit evidence to the contrary. The growth of exports in Agra did result in growth of a few firms both in terms of output and employment but it barely affected the vast number of small producers caught in the lower end of the domestic market. In other words exporting firms are de-linked from the artisanal producers and the growth of exports did not result in a high road growth path for the small producers in the cluster. The Agra footwear cluster tells us a different story from that generally discussed in the context of increased access to foreign markets.
