The Swedish paradox: What India can learn from a peripheral European nation that built global firms
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In 1923, a Swedish-backed company entered the Indian match industry. The Western India Match Company, better known as Wimco, was incorporated near Bombay and soon became one of the most visible foreign firms in a humble but indispensable market – the safety match.
Its legacy is so entrenched that an industrial suburb and a metro station in Chennai are named Wimco Nagar, a reminder of the industrial geography that Swedish capital helped shape in colonial India.
Wimco was not an isolated venture. It was part of a much larger Swedish story: how an economically backward, peripheral European country, with a small population and a limited domestic market, produced global firms in telephony, engineering, ball bearings, dairy technology, steel tools, electrical equipment and industrial gases.
At the close of the nineteenth century, Sweden looked like an unlikely candidate for industrial greatness. Its income lagged behind Britain, Belgium and Germany. Its industrialisation began late.
Its winters were harsh, its domestic market small, and the famine of 1867-’69 pushed hundreds of thousands towards emigration. Yet by the early twentieth century, companies such as Ericsson, Alfa Laval, SKF, ASEA, Sandvik and AGA had become pioneering global leaders in industrial innovation and development.
It was a political economy of late development.
The ‘gift’ of economic backwardness
The economic...