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ACKNOWLEDGEMENT EXECUTIVE SUMMARY
Introduction of Indian banking industry 1.1 Indian banking industry 1.2 Banking structure in Indian
6 10 24
History of banking in India
Globalization 2.1 Introduction 2.2 Globalization in India 2.3 Merits and Demerits 27 29 35
Effects of Globalization on different industries 3.1 Introduction 3.2 On Industrial sector 3.3 On petrol industry 3.4 On chemical industry 3.5 On social and economic life Liberalization 4.1 Introduction 4.2 Advantages and disadvantages 40 41 42 43 46 50 52
Privatization 5.1 Introduction 5.2 Advantages and disadvantages
ICICI bank 7.1 Introduction 63
It has been a great prestige and pleasure to work on the project “EFFECTS OF GLOBALIZATION ON INDIAN BANKING INDUSTRY.” I have gained valuable information and knowledge regarding role of advertisement in growth of banks. I would sincerely like to thank my project guide MRS. MAHEK MANSURI who has given me utmost support and guidance throughout in making the project. I would like to thank THE UNIVERSITY OF MUMBAI who gave me this opportunity to work on this project and also to learn new ideas and concepts which can be valuable for me in the future. Lastly I would like to thank the college staff, my colleagues, family and all those who extended necessary help during the course of our project work.
BHAVYA FOFARIYA ROLL NO.11
Globalization is the process by which events in distant places affect people's lives and their opportunities. Trade and finance are among the most powerful forces transmitting knowledge and culture. This exchange of knowledge and culture has a much bigger effect on how people live their lives than international trade or finance ever thought. There ought to be positive and negative effects of globalization - it all comes as a package. Globalization helps in creating new markets and wealth, at the same time it is responsible for extensive suffering, disorder, and unrest. The great financial crisis that just happened is the biggest example of how negative globalization can turn. It clearly reveals the dangers of an unstable, deregulated, global economy. At the same time, this gave rise to important global initiatives, striving towards betterment. Globalization is a factor responsible for both repression and the social boom. ICICI Bank is India's largest private sector bank by market capitalization and second largest overall in terms of assets. It is well know that ICICI Bank has
the largest Authorized Capital Base in the Banking System in India i.e. having a total capacity to raise Rs. 19,000,000,000 (Non – Premium Value). Though having an international presence, ICICI Bank has not been able to keep up the international standards in providing customer service as well as banking works.
Introduction to Indian banking industry
Introduction Banking structure
• History of banking in India
INDIAN BANKING INDUSTRIES
The Indian banking market is growing at an astonishing rate, with Assets expected to reach US$1 trillion by 2010. An expanding economy, middle class, and technological innovations are all contributing to this growth. The country’s middle class accounts for over 320 million people. In correlation with the growth of the economy, rising income levels, increased standard of living & affordability of banking products are promising factors for continued expansion. Banking sector in India is expanding at an incredibly faster pace, with more and more banks realizing the benefits offered by globalization. Publicly owned banks handle more than 80% of the banking business in India and the rest is in the hands of private sector banks. However, banking in both the government and private sector is being revolutionized by this latest phenomenon call “GLOBALIZAION”.
BANKING STRUCTURE IN INDIA
SCHEDULED BANKS IN INDIA (A) Scheduled Commercial Banks Public sector Banks (28) • Nationalized Bank • Other Public Sector Banks (IDBI) • SBI and its Associates Private sector Banks (27) • Old Private Banks • New Private Banks Foreign Banks in India (29) Regional Rural Bank (102)
(B) Scheduled Cooperative Banks
Scheduled Urban Cooperative Banks (55)
Scheduled State Cooperative Banks (31)
Here we more concerned about private sector banks and competition among them. Today, there are 27 private sector banks in the banking sector: 19 old private sector banks and 8 new private sector banks. These new banks have brought in stateof-the-art technology and aggressively marketed their products. The Public sector banks are facing a stiff competition from the new private sector banks. The banks which have been setup in the 1990s under the guidelines of the Narasimham Committee are referred to as NEW PRIVATE SECTOR BANKS.
New Private Sector Banks
• Superior Financial Services • Designed Innovative Products • Tapped new markets • Accessed Low cost NRI funds • Greater efficiency
The Indian banking Industry is in the middle of an IT revolution, focusing on the expansion of retail and rural banking. Players are becoming increasingly customer - centric in their approach, which has resulted in innovative methods of offering new banking products and services. Banks are now realizing the importance of being a big player and are beginning to focus their attention
on mergers and acquisitions to take advantage of economies of scale and/or comply with “Basel-II” regulation.“Indian banking industry assets are expected to reach US$1 trillion by 2010 and are poised to receive a greater infusion of foreign capital,” says Prathima Rajan, analyst in Celent's banking group and author of the report.“The banking industry should focus on having a small number of large players that can compete globally rather than having a large number of fragmented players." Globalization has offered a number of advantages to the banking sector in India. Remarkable advancements in communication and information technology have facilitated the globalization of these domestic banks. Apart from the benefits, several risks are also associated with the opportunities made available by globalization. In order to fortify the Indian baking sector against the risks involved in globalization, appropriate regulatory, prudential and supervisory framework need to be adopted. This will help in strengthening the domestic banking system in a global environment.
HISTORY OF BANKING IN INDIA
There are three different phases in the history of banking in India. 1) Pre-Nationalization Era. 2) Nationalization Stage. 3) Post Liberalization Era.
PRE-NATIONALIZATION ERA: In India the business of banking and credit was practices even in very early times. The remittance of money through Hundies, an Indigenous credit instrument, was very popular. The Hundies were issued by bankers known as Shroffs, Sahukars, Shahus or Mahajans in different parts of the country.
ORIGIN: The history of Commercial banking in India had its origin in the Seventeenth Century with the Establishment of trading centers by the East India Company. Unable to depend on Indigenous bankers for trading and banking purposes, the East India Company encouraged the Establishment of agency house, which carried on trading and banking operations. Western Style banking in India began with the launching of banking operation by Calcutta agency houses and
trading firms for the benefit of their business. Both Messer’s Alexander & co. and Ferguson & co. combined their banking with other kinds of business. The history of commercial banking in India dates back to the Establishments of “Bank of Hindustan’, in 1770, which was a mere appendage of the former, and it was under the directions of the Europeans. However, this bank could not survive for long because of the failure of the parents firm in 1832.the Sholapur bank. Ltd. Started by trading houses also went into liquidation in 1818 due to the unwise combination of banking business with trading operation by them.
PRESIDENCY BANKS: The bank of Calcutta began its banking business in the year June 1806. The government of India did not realize the need for banks till 1809 and in that year, a Royal Charter re-designated the ‘the bank of Calcutta’ as the ‘the Bank of Bengal’. It was the first joint stock bank of British India sponsored by the government of Bengal. It was established with a capital of Rs.50 lakhs, one – fifth of which was contributed by the government, which shared the privilege of voting and directions. However, the power to issue currency notes was not given to the bank till 1823. In 1939, the bank was given the power to open branches and to deal in inland exchange. Two others Presidency banks namely ‘Bank of Bombay’ and bank of Madras’ were formed in April 1840 and July 1843 with a capital outlay of Rs. 52.25 and Rs. 30 lakhs respectively. The government had subscribed
Rs. 3 lakhs as capital in each of these banks. These three banks were called the Presidency banks, because they were partly financed by the East India Company.
SWADESHI MOVEMENT: A MOMENTUM FOR NEW BANKS: Following the Swdeshi Movement of 1905, many Indian Entrepreneurs banking institutions. Later many more banks sprung up like mushrooms. The number of Indian joint stock banks also increased remarkably during the period of 1906 -21. Important banking ventures started during these periods were:
No. 1 2 3 4 5 6 7 8 9 10
Name of the bank Bank of India Ltd The Corporation bank Ltd The Indian bank Ltd The bank of Baroda Ltd The Canara bank Ltd The Central bank of India Ltd The South Indian bank Ltd The Karur Vysya bank Ltd The Union bank of India Ltd The Tamil Nadu Mercantile bank Ltd.
Year 1906 1906 1907 1908 1910 1911 1911 1916 1920 1921
IMPERIAL BANK OF INDIA:
The bank of Bengal, the bank of Bombay and the bank of Madras referred as Presidency banks got amalgamated in to the Imperial bank of India, which came into existence on January 27, 1921 by the Imperial bank of India was created by the special act (XLVII OF 1920), the liability of its shareholders was limited as that of shareholders of all other banks registered under the Indian companies act. The only difference that the word limited does not form parts of its name, as it does in the case of banks constituted under the latter act.
This act, however did not give the bank power to issue notes and thus it was left without any control over currency of the country. However, it was allowed to hold government balances and to manage public debt and clearinghouses till the Establishment of the Reserve bank of India in 1935.the Reserve bank of India was established as a body corporate under the Reserve bank of India, which came in to effect on April 1, 1935 with a paid up capital of Rs.5 crore. The RBI was nationalized in 1948 soon after the country’s independence.
Though originally privately owned, after nationalization the RBI is fully owned by the government of India. The RBI took over all the functions of the Imperial bank of India, but the later was given the privilege of acting as agents of the former in places in which it had no branches.
BANKING REGULATION ACT
After independence of the country in 1947, keeping in view the necessity of regulating rapidly growing business of banking institutions and their organizational problems, a separate act known as “The Banking Companies Act” was enacted. Following which a bill was introduced in Parliament in March 1948 and was passed in February 1949. It came into force on March 19, 1949. The Act was then called the “Banking Companies Act, 1949” , now known as the “Banking Regulations Act 1949”. The provision of this act is in addition to the provision of the Indian Companies’ act of 1956, which are also applicable to banking companies. The banking regulations act was amended many times keeping in view the new roles, which the banks were expected to play in accordance the economic development of the country. “ Any company which is engaged in the manufacture of goods or carries on any trade and which accepts the deposits of money from public merely for the purpose of financing its business as such manufacturer or trader shall not be deemed to transact the business of banking within the meaning of this clause."
SHORTCOMINGS OF INDIAN COMMERCIAL BANKS AFTER INDEPENDENCE
Commercial banks can play an important role in directing the affairs of the economy in various ways. There were persistent complaints that banks in India were not discharging their functions in consonance with the objective of our socialist democracy. The commercial banks in India during the 1960s merely acted as financial agencies and failed to give any lead to the nation’s developments. The economic history of many countries that both economic development and growth of financial infrastructure go hand in hand. One peculiarity of the banking developments in India is that majority of the banks were launched by business houses and were closely associated with such houses, for example. Central bank of India was associated with the house of Tata’s; United Commercial bank was associated with house of Birla’s, Indian bank with the Rajas of Chettind, and Punjab national bank with Janis. They were formed with the objective of profit Maximization and were guided by their business houses.
Their area of operation was confined to urban center and port towns. Rural and interior areas totally neglected by these institutions. In banking development while states like Assam, Jammu Kashmir, Uttar Pradesh, Bihar, Orissa and Madhya Pradesh were totally neglected, state like Maharashtra, Gujarat and Tamil Nadu were adequately banked. In 1969, it was observed that in 13 districts of India there were no commercial bank offices at all. There were also regional disparities in the distribution of bank credit. The distribution of bank credit in 1967 indicates that the three states of Maharashtra (32.4 %), West Bengal (27.5%) and Tamil Nadu (10.2%) accounted for two thirds of the total bank credit disbursed in the country. Banks neglected for a long period of time the credit needs of several priority sectors of the economy such as, agriculture, small scale industry and cottage industry, retail trade and exports.
Sr. Name of Banks Amount of
no. Compensation 1 Central bank of India Ltd 1,750 2 Bank of India Ltd 1,450 3 Punjab National bank Ltd 1,020 4 Bank of Baroda Ltd 840 5 United Commercial bank Ltd 830 6 Canara bank Ltd 360 7 United bank of India Ltd 420 8 Dena bank Ltd 360 9 Syndicate bank Ltd 360 10 Union bank of India Ltd 310 11 Allahabad bank Ltd 310 12 Indian bank Ltd 230 13 Bank of Maharashtra Ltd 230 14 Indian overseas bank Ltd 250 Name of banks Nationalized and the Amount of Compensation paid (Rs. Lakhs)
Government took major steps in this Indian Banking Sector Reform after independence. In 1955, it nationalized Imperial Bank of India with extensive banking facilities on a large scale especially in rural and semi-urban areas. It formed State Bank of India to act as the principal agent of RBI and to handle banking transactions of the Union and State Governments all over the country. Seven banks forming subsidiary of State Bank of India was nationalized in 1960 on 19th July, 1969, major process of nationalization was carried out. It was the effort of the then Prime Minister of India, Mrs. Indira Gandhi. 14 major commercial banks in the country were nationalized. Second phase of nationalization Indian Banking Sector Reform was carried out in 1980 with seven more banks. This step brought 80% of the banking segment in India under Government-ownership. The following are the steps taken by the Government of India to Regulate Banking Institutions in the Country:
• • •
1949: Enactment of Banking Regulation Act. 1955: Nationalization of State Bank of India. 1959: Nationalization of SBI Subsidiaries. 1969: Nationalization of 14 major banks. 1971: Creation of credit Guarantee Corporation.
• 1961: Insurance cover extended to Deposits.
• 1975: Creation of regional rural banks. • 1980: Nationalization of seven banks with deposits over 200 crore.
After the nationalization of banks, the branches of the public sector bank India rose to approximately 800% in deposits and advances took a huge jump by 11,000%. Banking in the sunshine of Government ownership gave the public implicit faith and immense confidence about the sustainability of these institutions.
Banks are among the main participants of the financial system in India. Banking offers several facilities & Opportunities. All the banks in India were earlier private banks. They were founded in the pre-independence era to cater to the banking needs of the people. After the nationalization of 14 commercial banks in 1969, no new private banks were licensed by RBI in the country and public sector banks came to occupy dominant role in the banking structure. In the early 1990s the then Narasimha Rao government embarked on a policy of liberalization and gave licenses to a small number of private banks, which came to be known as New Generation tech-savvy banks, which included banks like ICICI Bank and HDFC Bank. The Narasimham Committee report of 1991, has envisaged a larger role for private sector banks. Now in all there are 21 Old private sector banks and 7 new private sector banks. The Financial Reforms that were initiated in the early 90s and the globalization and liberalization measures brought in a completely new operating environment to the Banks that was till then operating in highly protected surroundings. The setting up of a number of private banks and the measures of de19
regulation that encouraged competition has led to a situation where the survival of those who do not join the race will become difficult. The arrival of private banks with their superior state-of-the-art technology-based services pushed Indian Banks also to follow suit by going in for the latest technologies so as to meet the threat of competition and retain customer base. Services and products like "Anywhere Banking" "Tele-Banking" "Internet banking" "Web Banking”, e-banking, e-commerce, e-business etc. have become the buzzwords of the day and the Banks are trying to cope with the competition by offering innovative and attractively packaged technology-based services to their customers.
In recognition of the need to introduce greater competition with a view to achieving higher productivity & efficiency of the banking system, RBI issued few guidelines in January 1993 for the entry of private sector banking. These guidelines are as follows: 1. The banks shall be governed by the provisions of The Reserve Bank of India Act, 1934, the Banking Regulations Act, 1949 other relevant statuaries. 2. Private sector banks are required to be registered as public limited companies in India. 3. The authority to grant a license lies with the RBI. 4. The shares of banks are required to be listed on stock exchanges.
5. Preference will be given to those banks whose headquarters are proposed to be located in a centre, which does not have headquarters of any other bank. 6. Maximum voting rights of an individual shareholder would be limited to 1% of total voting rights. 7. The new bank would not be allowed to have as its director any person who is already a director in a banking company. 8. The bank will be subject to prudential norms in respect of banking operations, accounting policies and other policies, as laid down by RBI. The bank will be required to stick to the following: Minimum paid up share capital of Rs. 1 bln. Promoters' contribution as determined by the RBI Capital adequacy of 8% of the risk weighted assets Single borrower and group borrower exposure limits in force Priority sector lending Export credit Loan policy within overall policy guidelines laid down by the RBI. 9. The banks will be free to open branches anywhere once they satisfy the capital adequacy and prudential accounting norms. 10. The banks would not be allowed to have investments in subsidiaries, mutual funds and portfolio investments in other companies in excess of 20% of the banks' own paid up capital and reserves.
11. The banks would be required to use modern infrastructure facilities in office equipment, computer, telecommunications, etc. The RBI was granting approvals for entry of private sector banks provided such banks were offering competitive, efficient and low cost financial intermediation services, result in up gradation of technology in the banking sector, are financially viable and do not resort to unfair means like preemption and concentration of credit, monopolization of economic power, cross holding with industrial groups etc. Private Banks have played a major role in the development of Indian banking industry. They have made banking more efficient and customer friendly. Private bankers are very aggressive and going desperately for higher exposure to micro finance portfolio. In a move to give freedom in the functioning of private banks, RBI has withdrawn its nominee directors from almost all the private sector banks. The return on assets of the private sector banks has been the highest. Most of the investments held by private banks were in a maturity bucket of less than a year. At the same time, technological development in the sector helped the banks in diversifying their business activities to offer different services to customers.
STRUCTURE OF THE ORGANISED BANKING IN INDIA
Globalization in India
• Globalization in India • Merits & Demarits
Globalization is a term that includes a wide range of social and economic variations. It can encompass topics like the cultural changes, economics, finance trends, and global market expansion. There ought to be positive and negative effects of globalization - it all comes as a package. Globalization helps in creating new markets and wealth, at the same time it is responsible for extensive suffering, disorder, and unrest. The great financial crisis that just happened is the biggest example of how negative globalization can turn. It clearly reveals the dangers of an unstable, deregulated, global economy. At the same time, this gave rise to important global initiatives, striving towards betterment. Globalization is a factor responsible for both repression and the social boom. What happens when there is a growing integration of economies across the globe? Majorly there have been positive impacts of this global phenomenon - through liberalization, privatization and globalization (LPG). Due to globalization, there has been significant flow of inward foreign direct investment. MNCs are getting a chance to explore various different markets across economies and explore the untapped potential. The human society around the world, over a period of time, has established greater contact, but the pace has increased rapidly since the mid 1980’s.The term globalization means international integration. It includes an array of social, political and economic changes. Unimaginable progress in modes of communications, transportation and computer technology have given the process a new lease of life.
The world is more interdependent now than ever before .Multinational companies manufacture products across many countries and sell to consumers across the globe. Money, technology and raw materials have broken the International barriers. Not only products and finances, but also ideas and cultures have breached the national boundaries. Laws, economies and social movements have become international in nature and not only the Globalization of the Economy but also the Globalization of Politics, Culture and Law is the order of the day. The formation of General Agreement on Tariffs and Trade (GATT), International Monetary Fund and the concept of free trade has boosted globalization. Broadly speaking, the term ‘globalization’ means integration of economies & societies through cross country flows of information, ideas, technologies, goods, services, capital, finance and people. Cross border integration can have several dimensions – cultural, social, political and economic. In fact, some people fear cultural and social integration even more than economic integration. The fear of “cultural hegemony” haunts many. Limiting ourselves to economic integration, one can see this happen through the three channels of (a) Trade in goods and services (b) Movement of capital (c) Flow of finance Besides, there is also the channel through movement of people.
Globalization has been a historical process with ebbs and flows. During the Pre-World War I period of 1870 to 1914, there was rapid integration of the economies in terms of trade flows, movement of capital and migration of people. The growth of globalization was mainly led by the technological forces in the fields of transport and communication. There were less barriers to flow of trade and people across the geographical boundaries. Indeed there were no passports and visa requirements and very few non-tariff barriers and restrictions on fund flows. The pace of globalization, however, decelerated between the First and the Second World War. Most economies thought that they could thrive better under high protective walls. After World War II, all the leading countries resolved not to repeat the mistakes they had committed previously by opting for isolation. Although after 1945, there was a drive to increased integration; it took a long time to reach the Pre-World War I level. In terms of percentage of exports and imports to total output, the US could reach the pre-World War level of 11 per cent only around 1970. Most of the developing countries which gained Independence from the colonial rule in the immediate Post-World War II period followed an import substitution industrialization regime.The Soviet bloc countries were also shielded from the process of global economic integration. However, times have changed. In the last two decades, the process of globalization has proceeded with greater vigour. The former Soviet bloc countries are getting integrated with the global economy. More and more developing countries are turning towards outward oriented policy of growth. Yet, studies point out that trade and capital markets are no more globalized today than they were at the end of the 19th century. Nevertheless, there are more concerns about globalization
GLOBALIZATION IN INDIA
India's economy opened up during the early nineties. The policy measures on the domestic front demanded that there was a requirement of multinational organizations to set up their offices here. The market became more open and the economy started responding to the external (global) market. Due to globalization, contacts have been developed all across the globe, with the pace of integration dramatically increasing. Idea behind the new economic model known as Liberalization, Privatization and Globalization in India (LPG), was to make the Indian economy one of the fastest growing economies in the world. An array of reforms was initiated with regard to industrial, trade and social sector to make the economy more competitive. The economic changes initiated have had a dramatic effect on the overall growth of the economy. It also heralded the integration of the Indian economy into the global economy. The Indian economy was in major crisis in 1991 when foreign currency reserves went down to $1 billion and inflation was as high as 17%. Fiscal deficit was also high and NRI's were not interested in investing in India. Then the following measures were taken to liberalize and globalize the economy.
IMPACTS OF GLOBALIZATION
It was in July 1991, when foreign currency reserves had tumbled down to almost $1 billion; inflation was at a soaring high of 17%, highest level of fiscal deficit, and foreign investors loosing confidence in Indian Economy. With all these coupling factors, capital was on the verge of flying out of the country and we were on the brink of become loan defaulters. It was at this time that with so many bottlenecks at bay, a complete overhauling of the economic system was required. Policies and programs changed accordingly. This was the best time for us to realize the importance of globalization.
Measures of Globalization
1. Devaluation: The first initiative towards globalization had been taken the
moment there was an announcement of devaluating the Indian currency by a hoping 18-19% against all the major global currencies. This was a major initiative in the international foreign exchange arena. The Balance of payment crisis could also be resolved by this measure.
2. Disinvestment: The core elements of globalization are privatization and
liberalization. Under the privatization scheme, bulk of the public sector undertakings have been/ and are still being sold to the private sector. Thus the concept of PPP (public private partnership) came up.
3. Allowing Foreign Direct Investment (FDI): Allowing FDI inflows is a major
step of globalization. The foreign investment regime has been quite transparent and thus the economy is getting boosted up. Various sectors were opened up for liberalizing the FDI regime.
Is globalization delivering all the desired results to the masses? Or only a few can feel the benefits of globalization? Figures have out rightly proved that the global average per capita income showed a strong surge throughout the 20th century but the income gap between rich and poor countries have not been bridged for many decades now. The ultimate inference being that globalization hasn't shown positive results.
MERITS & DEMRITS OF GLOBALIZATION
The Merits of Globalization are as follows:
There is an International market for companies and for consumers there is a wider range of products to choose from.
Increase in flow of investments from developed countries to developing countries, which can be used for economic reconstruction.
Greater and faster flow of information between countries and greater cultural interaction has helped to overcome cultural barriers.
Technological development has resulted in reverse brain drain in developing countries.
With globalization, there is a global market for companies to trade their products and a wider range of options for people, to choose from among the products of different nations.
Developing countries benefit a lot from globalization, as there is a sound flow of money and thus, a decrease in the currency difference.
To meet the increasing demands that follow globalization, there is an increase in the production sector. This gives loads of options to the manufacturers as well.
Competition keeps prices relatively low, and as a result, inflation is less likely to occur.
The focus is diverted and segregated among all the nations. No country remains the single power head; instead there are compartmentalized power sectors. The decisions at higher levels are meant for the people at large.
Communication among the countries is on the rise, which allows for better understanding and broader vision. As communication increases amongst two countries, there is interchange of cultures as well. We get to know more about the other's cultural preferences. As we feed to each other's financial needs, the ecological imbalance is also meted out. Governments of countries show concern about each other.
The Demerits of Globalization are as follows
The outsourcing of jobs to developing countries has resulted in loss of jobs in developed countries.
There is a greater threat of spread of communicable diseases.
There is an underlying threat of multinational corporations with immense power ruling the globe.
For smaller developing nations at the receiving end, it could indirectly lead to a subtle form of colonization.
Globalization is causing Europeans to lose their jobs as work is being outsourced to the Asian countries. The cost of labor in the Asian countries is low as compared to other countries.
The high rate of profit for the companies, in Asia, has resulted in a pressure on the employed Europeans, who are always under the threat of the business being outsourced.
Companies are as opening their counterparts in other countries. This results in transferring the quality of their product to other countries, thereby increasing the chances of depreciation in terms of quality.
There are experts who believe that globalization is the cause for the invasion of communicable diseases and social degeneration in countries.
The threat that the corporate would rule the world is on high, as there is a lot of money invested by them.
It is often argued that poor countries are exploited by the richer countries where the work force is taken advantage of and low wages are implemented.
Effects of Globalization on different industries
• On Industrial sector
On Petrol sector On Chemical
sector • On social Life & economic Life
EFFECTS OF GLOBALIZATION ON DIFFERENT INDUSTRIES
Effects of Globalization on Indian Industry Effects of Globalization on Indian Industry started when the government opened the country's markets to foreign investments in the early 1990s. Globalization of the Indian Industry took place in its various sectors such as steel, pharmaceutical, petroleum, chemical, textile, cement, retail, and BPO. Globalization means the dismantling of trade barriers between nations and the integration of the nations economies through financial flow, trade in goods and services, and corporate investments between nations. Globalization has increased across the world in recent years due to the fast progress that has been made in the field of technology especially in communications and transport. The government of India made changes in its economic policy in 1991 by which it allowed direct foreign investments in the country. As a result of this, globalization of the Indian Industry took place on a major scale. The various negative Effects of Globalization on Indian Industry are that it increased competition in the Indian market between the foreign companies and domestic companies. With the foreign goods being better than the Indian goods, the consumer preferred to buy the foreign goods. This reduced the amount of profit of the Indian Industry companies. This happened mainly in the pharmaceutical, manufacturing, chemical, and steel industries. The negative Effects of Globalization on Indian
Industry are that with the coming of technology the number of labor required decreased and this resulted in many people being removed from their jobs. This happened mainly in the pharmaceutical, chemical, manufacturing, and cement industries. The effects of globalization on Indian Industry have proved to be positive as well as negative. The government of India must try to make such economic policies with regard to Indian Industry's Globalization that are beneficial and not harmful.
Globalization and Structural Changes Globalization and the Indian in the Indian Industrial Sector Globalization of Indian Pharmaceutical Industry Globalization and Indian Textile Industry Globalization Era Globalization and Indian Cement Industry Globalization and SMEs Petroleum Industry Globalization and Indian Chemical Industry Globalization and the Indian Manufacturing Sector Steel Industry Globalization and Indian Retail Industry
Small Scale Industries in India in The Effects of Globalization on Indian
Globalization and Structural Changes in the Indian Industrial Sector
It took place in the early 1990s when the government decided to open the markets to foreign investments by forming new economic polices. Structural Changes in the Indian Industrial Sector and Globalization were initiated because the government wanted to encourage growth by doing away with supply bottlenecks that stopped efficiency and competitiveness. Globalization implies the dismantling of trade barriers between nations and the integration of the economies of the nations through financial flow; trade in services and goods, and corporate investments between nations. Globalization has increased in the recent years due to the rapid progress that has been made in the area of technology especially in communications and transport. The Indian policies with regard to the industrial sector before globalization had imposed many restrictions on the sector with regard to the use and procurement of capital and raw material, type and nature of industry where the entry of private sector was allowed, the operation scale, and the various markets where they could supply. The Indian industrial policies favored firms of small size that were labor intensive. The Structural Changes in the Indian Industrial Sector was brought about by the New Economic Policy of 1991 which did away with many of the regulations and restrictions. The various advantages of Globalization and Structural Changes in the Indian Industrial Sector are that it brought in huge amounts of foreign investments and this gave a major boost to this sector.
Many foreign companies entered the Indian market and they brought in highly technologically advanced machines into the country as a result of which the Indian Industrial Sector became technologically advanced. With new companies being set up in the Indian Industrial Sector it provided employment opportunities for many people in the country which in its turn helped to reduce the level of poverty in the country. The number of factories in India in 1990-1991 stood at 110,179 and in 2003-2004, the figure increased to 129,074. The various disadvantages of Globalization and Structural Changes in the Indian Industrial Sector are that with many foreign companies entering the sector increased the competition for the domestic companies. With foreign goods being better then the Indian products, the consumer in the country preferred to buy the foreign goods. This reduced the profit levels of the Indian companies and they had to resort to lowering the prices of their products which in turn further lowered their levels of profit. With highly advanced technology entering the Indian Industrial Sector, the number of labor required in the sector reduced. The number of labor in the Indian Industrial Sector in 1990-1991 was 81, 62,504 and in 2003-2004, the figure has decreased to 78, 70,081. Thus, Globalization and Structural Changes in the Indian Industrial Sector poses advantages and disadvantages for the country. So the government of India must take steps in order to ensure that the changes in the structure of the Indian Industrial Sector are such that it facilitates globalization in a manner that is gainful and constructive for a country like India.
Globalization and the Indian Petroleum Industry
Globalization and the Indian Petroleum Industry go hand in hand since Globalization of the Indian Petroleum Industry started soon after the independence of the country. The Indian Petroleum Industry was dependent from the very beginning on foreign capital, expert personnel, and technology, which led to the industry's globalization. Globalization entails the integration of the nations' economies through corporate investments, financial flow, and trade in goods and services between nations. Globalization also means the dismantling of trade barriers between nations and it has increased in the last few years due to the massive progress that has been made in the area of technology, especially in transport and communications. The Indian Petroleum Industry's Globalization took place since foreign involvement in the various important stages such as production, refining, exploration, and transportation increased over the years. In order to further encourage the Globalization of the Indian Petroleum Industry, the government of India took certain measures in the early 1990s when the country opened its markets to foreign investments.
Globalization and the Indian Petroleum Industry has-been going together as has been seen for the past many years. The government of India has taken several measures in order to ensure that the Globalization of the Indian Petroleum Industry is successful for the industry. In the future, the government is likely to ensure that
Indian Petroleum Industry's Globalization is beneficial for the industry and not harmful.
Effects of globalization In Indian chemical industry
Effects of globalization In Indian chemical industry the process of globalization of Indian chemical industry was initiated in the early 1990s. The erstwhile Indian chemical industry suffered due to the absolute monopoly of the Government of India enterprises. But with the opening of the Indian markets to Foreign Institutional Investors (FII) and Foreign Direct Investments (FDI) the monopoly of these Government institutions were curtailed substantially. This gave rise to the opening up of the Indian chemical industry to host of untapped opportunities. With the introduction of the open-market economic policy by the Government of India the process of globalization of Indian chemical industry took a steady rise. The Department of Chemicals & Petrochemicals under Government of India is the concerned highest authority that regulates the Indian chemical industry and the allied areas of environmental concern. The chemical Industry of India is at par with world standard and it shares a good portion of chemical business in world market. Asian countries, African countries and even Arab world buys Indian chemical products. The demand for Indian chemical products is high across the world. The reason for this popularity is its high quality and competitive pricing. India's low cost and high end chemical products manufacturing expertise coupled with world
class manufacturing infrastructure is the main leveraging factor for the rise of this industry. India offers high class chemical products at a substantial discount than its western counterparts while delivering the same grade of output.
Impact of Globalization on Employment in India
Globalization has played an important role in the generation of employment in India. Since the economic liberalization policies in the 1990s, the employment scenario in the country has significantly improved. An analysis of the impact of globalization on employment in India will bring out a number of factors in this regard.
Growth of new segments in the market
Due to globalization and the growth of the consumer market, a number of segments in various sectors of the industry have grown over the years. This has led to the significant rise in the rate of demand and supply. In the recent years, a number of industry segments such as information technology, agro products, personal and beauty care, health care and other sectors have come into the market. Experts say that the introduction of a wide range of sectors have led to the favorable growth of the economy in the country. With more and more industry segments coming up, there has been a high demand for quality workforce. As such, lots of young people are taking jobs in all these segments in order to start a good career.
In the unorganized sector as well, there has been an increase in various sectors which has improved the rate of employment in the country. As per the recent surveys, there has been a significant increase in the number of people working in the unorganized and allied sectors. The pay package in all these unorganized sectors have also increased to a great extent.
Improvement in the standard of living
As globalization has put a favorable impact in the economy of the country, there has been an improvement in the standard of living of the people. The favorable economic growth has led to the development of infrastructure, health care facilities and services, per capita income and other factors which have really led to the high growth rate. It has been expected that the economy in India will grow by around 6-7% yearly. This growth rate is expected to improve the overall employment situation more and the per capita income will also increase significantly.
Development of other sectors
Globalization has positively affected the growth of various sectors in India. These have opened up new employment opportunities for the people. The service industry has a share of around 54% of the yearly Gross Domestic Product (GDP). From this figure itself, it is understood that the service industries are doing very well in the market and as such, plenty of employment opportunities are taking
place. In the other sectors such as industry and agriculture, the rate of employment has gone up. The industrial sector contributes around 29 % while the agricultural sector contributes around 17 % to the gross domestic product. Some of the well known exports of the country consist of tea, cotton, jute, wheat, sugarcane and so on. Due to the growth of customer base in all these sectors, more and more employment opportunities are opening up. In fact even young people and freshers are getting jobs in all these sectors. In the manufacturing sector, there has been a growth of around 12% while the communication and storage sector has also grown up by around 16.64%.
Growth of new segments in the market
Due to globalization and the growth of the consumer market, a number of segments in various sectors of the industry have grown over the years. This has led to the significant rise in the rate of demand and supply. In the recent years, a number of industry segments such as information technology, agro products, personal and beauty care, health care and other sectors have come into the market. Experts say that the introduction of a wide range of sectors have led to the favorable growth of the economy in the country. With more and more industry segments coming up, there has been a high demand for quality workforce. As such, lots of young people are taking jobs in all these segments in order to start a good career. In the unorganized sector as well, there has been an increase in various sectors which has improved the rate of employment in the country. As per
the recent surveys, there has been a significant increase in the number of people working in the unorganized and allied sectors. The pay package in all these unorganized sectors have also increased to a great extent.
Development of other sectors Globalization has positively affected the growth of various sectors in India. These have opened up new employment opportunities for the people. The service industry has a share of around 54% of the yearly Gross Domestic Product (GDP). From this figure itself, it is understood that the service industries are doing very well in the market and as such, plenty of employment opportunities are taking place. In the other sectors such as industry and agriculture, the rate of employment has gone up. The industrial sector contributes around 29 % while the agricultural sector contributes around 17 % to the gross domestic product. Some of the well known exports of the country consist of tea, cotton, jute, wheat, sugarcane and so on. Due to the growth of customer base in all these sectors, more and more employment opportunities are opening up. In fact even young people and freshers are getting jobs in all these sectors. In the manufacturing sector, there has been a growth of around 12% while the communication and storage sector has also grown up by around 16.64%.
Liberalization in India
• Liberalization in India • Merits & Demarits
The Government of India started the economic liberalization policy in 1991. Even though the power at the center has changed hands, the pace of the reforms has never slackened till date. Before 1991, changes within the industrial sector in the country were modest to say the least. The sector accounted for just one-fifth of the total economic activity within the country. The sectoral structure of the industry has changed, albeit gradually. Most of the industrial sector was dominated by a select band of family-based conglomerates that had been dominant historically. Post 1991, a major restructuring has taken place with the emergence of more technologically advanced segments among industrial companies. Nowadays, more small and medium scale enterprises contribute significantly to the economy. By the mid-90s, the private capital had surpassed the public capital. The management system had shifted from the traditional family based system to a system of qualified and professional managers. One of the most significant effects of the liberalization era has been the emergence of a strong, affluent and buoyant middle class with significant purchasing powers and this has been the engine that has driven the economy since. Another major benefit of the liberalization era has been the shift in the pattern of exports from traditional items like clothes, tea and spices to automobiles, steel, IT etc. The ‘made in India’ brand, which did not evoke any sort of loyalty has now become a brand name by itself and is now known all over the world for its quality. Also, the reforms have transformed the education sector with a huge talent pool of qualified professionals now available, waiting to conquer the world with their domain knowledge.
India, after all these years of economic reforms, is at the crossroads. While one road leads India to economic prosperity and glory, the other road leads it to social inequality. Presently, as India is one of the fastest growing economies in the world, the social aspects have been ridden roughshod by the economic benefits. What has been conveniently forgotten or suppressed till date have been the disparities, mainly the socio-economical issues. This has led to growing discontent among the population and it has gathered momentum since the reforms began 15 years ago. It will very soon reach a critical point wherein the very purpose for which the reforms were started, will start to lose their significance rapidly and throw the country back into the ‘license raj’ and ‘unionist’ era. The chasm between the rich and the poor has increased so vastly that the rich are just getting richer and the poor are just getting poorer. The real benefits of the economic reforms have rarely percolated to the lowest strata of society. Just to illustrate the same with an example, most of the states today vie with one another to grab a project of any significance, be it chemical, auto or even IT. In doing so, the benefits they are offering, right from free land to tax sops are being given on a platter. But the benefits or savings that a company gains from this does not affect the lower strata of management, but remains in the hands of the top management, thus depriving the former of the economic benefits. Also, most of the labor laws in the country are outdated and have not kept pace with economic reforms. Thus, the exploitation of the working class becomes much easier. A classic example is the BPO industry in our country. While most of them work in the nights, the pressure each employee faces to deliver results and the working conditions are appalling, to say the least.
The agricultural sector has also seen this disproportionate growth, as it is a field that has been left high and dry in the pursuit of agricultural reforms. The sector has been opened up to the multi-nationals, without having evolved a comprehensive cover for our farmers, most of who are poor and own very little land of their own. A case in point is the spate of farmer suicides that our country has witnessed in the past few years. The developed countries, which clamour for open-ended policies, have, in fact, some of the fiercest protection policies when it comes to their agricultural sector. Small scale industries (SSIs), the heart and soul of many towns and villages, have been virtually ignored. More than half of them have closed down in the last few years in the face of intense competition from multi nationals who have unmatched financial and political muscle. On a parting note, what are essential for India are economic reforms with a social face. The economic policies and their subsequent reforms must be accompanied by suitable clauses to benefit the economically weaker sections. Various schemes must be thoroughly scrutinized and efforts must be made to see that the rewards must reach everyone. Then India will not only be economically prosperous, but will also forge ahead towards its goal of world dominance.
1. Integration of markets: Markets are interlinked- European Union. 2. Cheaper Products for Consumer: Trainers are Cheap. 3. Leads to Outsourcing in some cases which can lead to job loses: Moving call centers to India. 4. Lowering of international Bariers: Now European Union can Trade with ASEAN and NAFTA. 5. Providing jobs in LEDC's and help develop economy (less Economically Developed Countries) 6. Helps prevent market Saturation in a specific market: stops there being too much competitors in one place e.g. too much call canters in UK, so move to India 7. Standardization of product: the same products can be seen in some many places - e.g coke and McDonalds .
DISADVANTAGES 1. Intense Competition 2. Widening of Gap between rich and poor countries 3. Harder for Smaller businesses to establish themselves 4. Exploitation of workers: Paying the workers in LEDC's a fraction of what would be paid in to workers in LEDCs. 5. Income generated in Host country is not always spent in the same country money earned from supplying cheap call centers’ in India will not be spent in India but maybe in UK or US.
Privatization in India
• Privatization in India • Merits & Demerits
PRIVATIZATION Transfer of government services or assets to the private sector. State-owned assets may be sold to private owners, or statutory restrictions on competition between privately and publicly owned enterprises may be lifted. Services formerly provided by government may be contracted out. The objective is often to increase government efficiency; implementation may affect government revenue either positively or negatively. Privatization is the opposite of nationalization; a policy resorted to by governments that want to keep the revenues from major industries, especially those that might otherwise be controlled by foreign interests.
ADVANTAGES OF PRIVATIZATION • ·Privatization places the risk in the hands of business or Private Enterprise.
·Private enterprise is more responsive to customer complaints and innovation. ·The Govt. should not be a player and an umpire. ·Privatization provides a one off cash boost for Govt. This can be spent on Hospitals etc... ·Privatization leads to lower prices and greater supply.
• ·Competition in privatization increases differentiation.
DISADVANTAGES OF PRIVATIZATION
Privatization is expensive and generates a lot of income in fees for specialist advisers such as banks. Public monopolies have been turned into private monopolies with too little competition, so consumers have not benefited as much as had been hoped. This is the main reason why it has been necessary to create regulators (OFWAT, OFGAS etc). This is an important point. It partly depends on how the privatization took place. For example, the railways were privatized in bit of a rush and there might have been other ways to do it so that more competition was created. It partly depends on the market. Some markets are 'natural monopolies' where competition is difficult. For example, it would be very wasteful and expensive to build two sets of track into Liverpool Street just to create some competition. Natural monopolies create a special justification for public ownership in the general public interest.
The nationalized industries were sold off too quickly and too cheaply. With patience a better price could have been had with more beneficial results on the government's revenue. In almost all cases the share prices rose sharply as soon as dealing began after privatization.
The privatized businesses have sold off or closed down unprofitable parts of the business (as businesses normally do) and so services e.g. transport in rural areas have got worse.
• Wider share ownership did not really happen as many small investors took their profits and didn't buy anything else.
GROWTH OF FOREIGN BANKS IN INDIA
By 2009 few more names is going to be added in the list of foreign banks in India. This is as an aftermath of the sudden interest shown By Reserve Bank of India paving roadmap for foreign banks in India greater freedom in India. Among them is the world's best private bank by Euro Money magazine, Switzerland's UBS. The following are the list of foreign banks going to set up business in India:• • • • •
Royal Bank of Scotland Switzerland's UBS US-based GE Capital Credit Suisse Group Industrial and Commercial Bank of China
TOP BANKS IN INDIA
With the advancement of technology and the birth of competition, banks are in the race of becoming the best in the country. With an eye upon customer satisfaction policy they are providing best of the best services with the minimum hazards. Banks like ABN AMRO introduced banking with a coffee. It made a tie-up with one of the best coffee bar in the country, Barista and remained open till late evening for customers with a setup of a coffee bar in the premises. Few banks have introduced world ATM card to make travelers across the globe more safe and secure. What else. Internet and Phone Banking is the call of the day for banks. In this race towards the best, we have selected top 20 banks in the country from all segments. It is not the ranking of banks but only for general information about the top banks in India. Abn Amro Bank Allahabad Bank American Express Bank Andhra Bank Axis bank Bank of India Canara Bank Central Bank of India Citibank HDFC Bank HSBC Bank ICICI Bank IDBI Indian Overseas Bank Oriental Bank of Commerce Punjab National Bank State Bank Of India (SBI) Standard Chartered Bank
ICICI Bank and studies
• • •
Introduction Product & services SWOT Analysis
INTRODUCTION OF ICICI BANK
ICICI Bank (formerly Industrial Credit and Investment Corporation of India) is India's largest PRIVATE SECTOR BANK by market capitalization and second largest overall in terms of assets. Bank has total assets of about USD 77 billion. ICICI Bank offers a wide range of banking products and financial services to corporate and retail customers through a variety of delivery channels and specialized subsidiaries and affiliates in the areas of investment banking, life and non-life insurance, venture capital and asset management. (These data are dynamic.) ICICI Bank is also the largest issuer of credit cards in India. ICICI Bank has got its equity shares listed on the stock exchanges at Kolkata and Baroda, Mumbai and the National Stock Exchange of India Limited, and its ADRs on the New York Stock Exchange (NYSE). The Bank is expanding in overseas markets and has the largest international balance sheet among Indian banks. ICICI Bank now has whollyowned subsidiaries, branches and representatives offices in 18 countries, including an offshore unit in Mumbai. This includes wholly owned subsidiaries in Canada,
Russia and the UK (the subsidiary through which the heaves savings brand is operated), offshore banking units in Bahrain and Singapore, an advisory branch in Dubai, branches in Belgium, Hong Kong and Sri Lanka, and representative offices in Bangladesh, China, Malaysia, Indonesia, South Africa, Thailand, the United Arab Emirates and USA. Overseas, the Bank is targeting the NRI (Non-Resident Indian) population in particular.
STRONG NATIONAL NETWORK
FIGURES STATING THE NUMBER OF BRANCHES AND ATMS OF ICICI BANK ICICI March 2008 Branches ATMs 1,485 4,816
The Bank also has a network of 1,485 branches and about 4,816 ATMs in India and presence in 18 countries, as well as some 24 million customers. Bank has total assets of about USD 77 billion. ICICI reported a 1.15% rise in net profit to Rs. 1,014.21 crore on a 1.29% increase in total income to Rs. 9,712.31 crore. The bank's current and savings account (CASA) ratio increased to 30%.
BOARD OF DIRECTORS
Name K V Kamath Chanda D Kochhar Sandeep Bakhshi N S Kannan Sonjoy Chatterjee M S Ramachandran K Ramkumar
Designation Non Executive Chairman Managing Director & CEO Deputy Managing Director Executive Director & CFO Executive Director Non Executive Director Executive Director
To identify and support initiatives which are designed to improve the capacity of the poorest of the poor to participate in the larger economy.
These initiatives must be cost effective, capable of large-scale replication and should have the potential for both near and long-term impact. To leverage technology in order to overcome constraints and
enhance the effectiveness of various social initiatives
PRODUCTS AND SERVICES OF ICICI BANK
ICICI BANK PRODUCT
OFFERS SERVICE SUCH AS 1. Personal banking 2. Wholesale banking 3. NRI banking
Investment & Insurance
• Auto Loan • Loan Against Security • Loan Against Property • Personal loan • Credit card • 2-wheeler loan • Commercial vehicles finance • Home loans • Retail business banking • Tractor loan • Working Capital Finance • Health Care Finance • Education Loan • Gold Loan
• Saving a/c • Current a/c • Fixed deposit • Demat a/c • Safe Deposit Lockers
• Mutual Fund • Bonds • Knowledge Centre • Insurance • General and Health Insurance • Equity and Derivatives • Mudra Gold Bar
Cards • Credit Card • Debit Card • Prepaid Card
Payment Services • Net Safe • Merchant • Prepaid Refill • Bill pay • Visa Bill pay • Instant Pay • Direct Pay • Visa Money Transfer • e–Monies Electronic Funds Transfer Online Payment of Direct Tax
Access To Bank • Net Banking • One View • Instant Alert Mobile Banking • ATM • Phone Banking • Email Statements Branch Network
Forex Services • Product & Services • Trade Services • Forex service Branch Locater • RBI Guidelin es
Small and Medium Enterprises
Financial Institutions and Trusts BANKS Sub– Membership submembership • Fund Transfer • ATM Tie-ups • Corporate Salary a/c • Tax Collection Financial Institutions Mutual Funds Stock Brokers Insurance Companies Commodities Business Trusts
• Funded Services • Non Funded Services Services • Internet Banking
• Funded Services • Non Services
Funded • Clearing
• Specialized Services • RTGS added services • Internet Banking
• Value Added • Value
Accounts & Deposits • Rupee Saving a/c • Rupee Current a/c • Rupee Fixed Deposits • Foreign Currency Deposits • Accounts Indians Investment & Insurances • Mutual Funds • Insurance • Private Banking • Portfolio Investment Scheme Payment Services Loans • Home Loans • Loans Against Securities • Loans Against Deposits • Gold Credit Card Access To Bank for Returning
1. Identify and support projects and programmed that are within its focus areas and,
• • •
have a large- scale and measurable- impact; Are replicable in a cost effective manner; and Are time-bound.
2. Identify and support pilot projects within its focus areas. 3. Contribute towards improving the efficacy of assisted organizations through:
capacity building; Providing access to research and information; and providing platforms for an effective exchange of ideas, thoughts and experiences.
1. AUTHORIZED CAPITAL: It is well know that ICICI Bank has the largest Authorized Capital Base in the Banking System in India i.e. having a total capacity to raise Rs. 19,000,000,000 (Non – Premium Value). 2. LOW OPERATING COST: ICICI Bank is not only known for large capital but also for
having a low operations cost though having huge number of branches and services provided.
1. WORKFORCE: It is well known that workforce responsiveness in banking sector is Very low in Indian banking sector, though ICICI Bank has better responsible staff but it still lacks behind its counterparts like HSBC, HDFC BANK, CITI BANK, YES BANK etc. 2. NOT EQUAL TO INTERNATIONAL STANDARDS: Though having an international presence, ICICI Bank has not been able to keep up the international standards in providing customer service as well as banking works.
OPPORTUNITY: MARKET EXPANSION:
Seeing the present financial & economic development of Indian Economy and also the tremendous growth of the Indian Companies including the acquisition spree followed by expanding market for finance them, it clearly states the
requirements and also the growth in surplus
disposal income of Indian citizens has given a huge rise in savings deposits – from the above point it is clear that there is a huge market expansion possible in banking sector in India.
OUTSOURCING OF NON-CORE BUSINESS: In the present world, India is preferred one of the best places for out – sourcing of business process works and many more.
1. COMPETITION: After showing a significant growth overall, India is able to attract many international financial & banking institutes, which are known for their state of art working and keeping low operation costs. 2. ENTRY OF MANY FOREIGN BANKS: In recent times, India has witnessed entry of many international banks like CITI Bank, YES Bank etc which posses an external entrant threat to ICICI Bank – as this Banks are known for their art of working and maintain high standards of customer service.
PRIMARY DATA & ITS ANALYSIS
With respect to the topic of my project, I made a survey in the ICICI bank. There was a set of common questions asked in respective bank. The information was provided by MR. SANTOSH (R & D). The following is the survey:ICICI BANK IS THE LARGEST PRIVATE SECTOR BANK IN INDIA. BANK WAS INTRODUCED IN VERY LATE AS COMPARED TO OTHER BANKS BUT IT TOOK VERY FAST GROWTH IN THE SECTOR. MAINTAINING RELATIONSHIP AND SERVICE PROVIDEING IS THE MAIL OBJECTIVE OF THE BANK. THIS MAKES THEM NO.1 IN THEIR BUSINESS. HDFC BANK AND SBI BANKS ARE THE MAIN COMPITITORS OF ICICI BANK. PROFESSIONAL APPROACH AND EDUCATED AND EFFICIENT HUMAN RESOURCE MADE THEM THE 1ST CHOICE OF THE CUSTOMER. AS COMPARED TO OTHER BANKS ICICI BANK CHARGES HIGHER FEES BUT AS PER THE NEW ERA CUSTOMER COMES FOR THE SERVICE AND SPECIAL TREATMENT. THIS WAS STARTED BY ICICI BANK. BECAUSE OF GLOBALIZED MARKET THE NEEDS & REQIREMENTS OF THE CUSTOMER CAN BE UNDERSTOOD MORE
NICELY. NEW TECHNIQUES AND SERVICES WHICH ARE INTRODUCED IN THE GLOBAL MARKET CAN BE UNDERSTOOD NICELY.
OTHER BAD ASPECT OF GLOBALIZATION WAS FACED BY ICICI BANK WAS IN THE YEAR OF 2008. US CRISES AND BANKRUPCY OF FAMOUS GLOBALIZED BANK LEHMEN BROTHERS ICICI LOST HUGE CAPITAL AND MONEY. BUT BECAUSE OF THEIR CUSTOMER RELARIONSHIP AND SERVICE DELIEVERY IN A SHORT TIME THEY MANAGED THE WHOLE SCENARIO.
We can say that the bank has performed very well in todays business
scenario as have a good unique product and service that have make them outperform others.
As market indicators reflect we can say ICICI Bank has been badly hit by recession and their loss in investment outside India.
New banking reform will be a good blessing for the banking sector in coming days and on the same hand will be creating a high competition from foreign players who will be allowed to increase their investment share in India.
BIBLIOGRAPHY Website:WWW.ICICIBANK.CO.IN WWW.GOOGLE.COM WWW.ASK.COM WWW.SCRIBD.COM WWW.WIKIPEDIA.COM WWW.MANAGEMENTARTICLE.COM WWW.SLIDESHARE.COM
Newspaper:ECONOMICS TIMES TIMES OF INDIA Books:GLOBALIZATOIN AND INDIA INDIAN BANKING INDUSTRY
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