Diasporas, migration, and trade: the Indian diaspora in North America

Purpose - The purpose of this paper is to study the migration of the Indian diaspora to Canada and the USA and its role in fostering trade and investment between them using its transnational social networks. Design/methodology/approach - This study was based on interviews with 25 Indian immigrants, 13 in Canada and 12 in the USA. Findings - The social networks that immigrants had in both their country of residence (COR) and country of origin (COO) act as conduits of trade and investment between the two. The Indian diaspora further facilitates economic engagement between the COO and COR by running cross‐border businesses, introducing Indian products and brands in the COR, introducing the Indian culture and helping non‐Indians to invest in India. Within the COO, the diaspora's social networks often helped Indians in India connect with markets, suppliers and potential business partners in the COR. Research limitations/implications - The sample size was 25 people and was restricted to managers, executives and entrepreneurs of Indian origin, since it was assumed that these people are the most likely to drive trade and investment between the COO and COR. Practical implications - For policy makers in COOs, the paper stresses the importance of maintaining social and economic ties to the diaspora, who can often bring important trade and investment related benefits to the COO. For CORs, the paper reveals the importance of utilizing the transnational networks that the diaspora possess, that can be beneficial for the COR companies in entering new markets. Leveraging both the human and social capital of the diaspora in a mutually beneficial way is one of the biggest challenges for policy makers in both the COO and the COR. Social implications - The paper shows that within the COR, the local Indian community provides social and moral, rather than financial support to newly arrived Indian immigrants. Originality/value - The paper explains the linkage between diasporas, trade and migration by focusing on the reasons for diaspora immigration, the social networks that the diaspora has, and the diaspora activities in the COR. It contributes to the literature on social networks by pointing out the importance of the diaspora's transnational social networks in both the COR and COO in driving trade and investment between them. It also adds to the brain circulation literature through its finding that pull factors, rather than push factors, were responsible for the vast majority of Indian immigration to the USA and Canada, and that by making diaspora‐friendly policies, brain circulation will be made easier, and this can help both the COO and COR in the long run.