Funny money circulation and fabric exports from China to Dubai through Indian trading networks

Cheuk, Ka-Kin (2022) Funny money circulation and fabric exports from China to Dubai through Indian trading networks. American Behavioral Scientist, 66 (2), 232–249. (doi:10.1177/00027642211020056).

Abstract

Chiefly drawing on my ethnographic fieldwork in the district of Keqiao in Zhejiang Province since 2009, I argue that irregular financial transactions—conceptualized as “funny money” in this article—play a significant role in the sustenance of otherwise tenuous business relations between Indian traders and Chinese suppliers in the China–Dubai fabric trade. Much of the fabric exported from Keqiao to Dubai relies on intertwined formal and informal transactions operated by Indian trading networks. These labyrinthine transnational funny money transactions aim to circumvent institutional hurdles and overcome deficiencies in operating capital, yet inherent to this system is a cycle of payment lags that cause tense relations between payers and payees. Funny money transactions facilitate eventual payment in most cases most of the time and maintain enough trust to keep the trade network alive. Furthermore, the interlocking circuits of funny money also prevent the overaccumulation of wealth and power by any particular stakeholder involved in the international trade and defy or at least circumvent the formal political authority of state and financial institutions that seek to curtail such practices. These transactions thereby create a larger space for business survival among the grassroots players, especially Indian traders who may not have enough capital available when they initiate a deal with a Chinese supplier.

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Author: Ka-Kin Cheuk

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