For many global companies, China and India represents a highly attractive market
ID: 2762444 • Letter: F
Question
For many global companies, China and India represents a highly attractive market in terms of size and growth rate. Yet China and to a certain degree India rank lower in terms of economic freedom and higher in political risk than do some other countries. Despite these risks, hundreds of companies have established manufacturing operations in China and India. In large part, this is because the governments of China and India makes selling in both countries contingent on a company’s willingness to locate production there. Both countries want their companies to learn modern management skills from Western companies and to acquire technology. There is a school of thought that Western companies are bargaining away important industry know-how in exchange for sales today by agreeing to such conditions. Should global companies go along with China’s and India’s terms, or should they risk losing sales by refusing to transfer technology? What do you think might be the long-term results of either solution?
Explanation / Answer
The multinational countries across different countries should agree to busienss ventures with countries like China and India. It is going to help them enter into a huge market because of highest population in both the countries. The supply and demand of the countries is always high due to huge market presence over there. It would create more business opporturnity in order to increase revenues.
The long term results of the solution is going to give rise to increase in revenues. It would propogate good results from the business. It would give a strong market value. It is going to increase the business expansion in other such countries. The company would intrdocue more new products looking at the requirement of the customers.
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