MNCs

Presented By NIHAL KASHYAP A65

What is Mncs?
y When a company operates in a home nation established its subsidiary in

other nation it becomes an MNC and there starts the process of globalization where in a local company serves the entire worlds with its products and services.
y India has experienced a dramatic increase in the presence of multinational

corporation having a tremendous expansion in the amount of foreign direct investment inflows to the Indian economy.
y Internet tools like Google, Yahoo, MSN, E-Bay, Skype, Amazon make it

easier for the MNCs to reach their potential customers in the country.

1st MNC in world

1st MNC In India

1st Indian MNCs

EAST INDIA COMPANY 1600

EAST INDIA COMPANY, 1600

Infosys 1981

Features of MNC
1.Big size 2.Huge intellectual capital 3.Operates in many countries 4.Large number of customer 5.Large number of competitors 6.Structured way of decision making

Why are MNCs in India

y Huge market potential of the country y FDI attractiveness y Labor competitiveness y Macro-economic stability y One billion plus population

Cont
y India ranked 10th largest economy, 4th largest in terms of

Purchasing Power Parity

y 250-300 million middle class y Gross Domestic Product (GDP) growing at over8-9 %,

makes it one of the fastest growing economies in the world

y Lucrative and diverse opportunities for U.S. exporters

with the right products or services

Impact on India
y Large amount of tax collection thru MNC s y Increased revenue y Economic health improved y Employment increased y Foreign relation increased

SWOT Analysis of MNC

Strengths Low cost Well Developed infrastructure

Weakness

Location is often very distant Lack of transportation facilities Relative inflexibility

Opportunities

Leverage Government Create the necessary infrastructure Attract new industries

Threats

Emergence of private companies Establishment of monopoly

Top Ten Brands in the World

IBM Microsoft LG Toyota Samsung Nokia Hyundai Fiat Nike Ford Sony

Some Indian MNCs

y y y y y y y

Asian Paints ICICI bank Infosys Tata Motors TCS Larson & Toubro Aptech / NIIT

MERITS OF MNC
y MNCs create employment opportunities in the host countries. It y y y y

helps to create a pool of managerial talent in the host country. Helps removal of monopoly and improve the quality of domestic made products. Promotes exports and reduce imports by raising domestic productions. Goods are made available at cheaper price due to economies of scale. Job and career opportunities at home and abroad in connection with overseas operations. Encourages the world unity and all resulting in world harmony.

De-merits of MNCs
y May acquire monopoly power y Underestimate local culture y Think of about profits rather than host country interest y Inflexibility in terms & conditions y Heavy use of non-renewable natural resources

CONCLUSION
y Due to these MNCs, competition increase and more

employment opportunities are available. y Gives advantages to domestic companies thru purchasing of raw material & resources. y New company having network to expand their business.