Globalization of Indian businessInternational Business

Prepared By

Manu Melwin Joy

Assistant ProfessorIlahia School of Management Studies

Kerala, India.

Phone – 9744551114Mail – manu_melwinjoy@yahoo.com

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India – An emerging market

• India is one of the largest andfastest growing markets in theworld.

• India is the second mostpopulous nation in the world.

• Although the per capitaincome of India is low, the sizeof GNI is large.

• 1n 2006, India was the 10th

largest economy in the world.

India – An emerging market

• In Purchase Power Parityterms, India is the fourthlargest economy in theworld and it is estimatedthat by 2030, it will bethe third largest afterchina and USA.

Growth of outsourced IT and business process outsourcing (BPO) services

• One of the major forces ofglobalization in India has been in thegrowth of outsourced IT and businessprocess outsourcing (BPO) services.The last few years have seen anincrease in the number of skilledprofessionals in India employed byboth local and foreign companies toservice customers in the US andEurope in particular. Taking advantageof India’s lower cost but educated andEnglish-speaking work force, andutilizing global communicationstechnologies such as voice-over IP(VOIP), email and the internet,international enterprises have beenable to lower their cost base byestablishing outsourced knowledge-worker operations in India.

Indian companies

• Indian companies are rapidlygaining confidence and arethemselves now majorplayers in globalizationthrough internationalexpansion. From steel toBollywood, from cars to IT,Indian companies are settingthemselves up aspowerhouses of tomorrow’sglobal economy.

LPG model• Indian economy had experiencedmajor policy changes in early1990s. The new economicreform, popularly knownas, Liberalization, Privatizationand Globalization (LPG model)aimed at making the Indianeconomy as fastest growingeconomy and globallycompetitive. The series ofreforms undertaken with respectto industrial sector, trade as wellas financial sector aimed atmaking the economy moreefficient.

LPG model

• With the onset of reforms toliberalize the Indian economy inJuly of 1991, a new chapter hasdawned for India and her billionplus population. This period ofeconomic transition has had atremendous impact on the overalleconomic development of almostall major sectors of the economy,and its effects over the lastdecade can hardly be overlooked.Besides, it also marks the adventof the real integration of theIndian economy into the globaleconomy.

Foreign Direct Investment (FDI)• Now that India is in the process of

restructuring her economy, withaspirations of elevating herself fromher present desolate position in theworld, the need to speed up hereconomic development is even moreimperative. And having witnessed thepositive role that Foreign DirectInvestment (FDI) has played in therapid economic growth of most of theSoutheast Asian countries and mostnotably China, India has embarked onan ambitious plan to emulate thesuccesses of her neighbors to theeast and is trying to sell herself as asafe and profitable destination forFDI.

Example

• Notable examples ofinternational companiesthat have done well inIndia in the recent yearsinclude Pepsi, Coca-Cola,McDonald’s, and KentuckyFried Chicken, whoseproducts have been wellaccepted by Indians atlarge.