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Q.

Indian companies over seas acquisitions ---so far the success is not really felt? When will it happen?

Asked by Good Citizen, 23 Nov '09 01:20 pm
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Answers (3)

1.

"Sterlites $2.6 billion buy"
TOI acquires Virgin Radio in UK for Rs.445 crores".
Mahindra & Mahindra takes over 90% stake in Schonewiss.
"Tata's acquisition of Corus".
India's Reliance eyes world-scale buyout of lyondelbasell".

Headlines such as these are a reflection of the emerging trend of overseas acquisitions by Indian companies. With the growth of the Indian economy at an average rate of 8.8 per cent every year, it may just prove to be an additional reason which triggers the growth in overseas investments. The data provided by the Reserve Bank of India for the year 2006 for the total value of Indian direct investments abroad was USD 9.7 billion. The latest World Bank report pegs India as the tenth largest economy in the world and the Goldman Sachs reports that Indias GDP will top $ 1 trillion by 2011, treble by 2025 and be $ 27 trillion by 2025, taking its economy to third place after the US and China.
The trend began haltingly a few years ago. In 2000, Tata Tea took over ...more
Answered by dharamender nebhnani, 23 Nov '09 09:23 pm

 
  
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2.

I doubt India will feel the success because Indian companies acquiring overseas assets features in Gross NATIONAL product (GNP) and not Gross DOMESTIC product (GDP). Incomes earned via GNP may or may not invest back in their home countries.

In Nazi Germany, u had Mescherschmitt Aircraft company which acquired overseas assets, but they invested back their profits in Germany. If the board of directors didn't invest back in Germany, then their families would be sent to a prison camp & executed.

I am not sure the same trend will be observed in India. Even as it is, EVEN WITH TAX MONEY we are seeing scenarios where 100 years of GDP savings are floated away to Swiss bank. GNP oriented earnings yield results for "home base" when we are a regional or a global epicenter.

Nazi Germany was a regional epicenter for Central Europe and competed w/ England for Western Europe. Modern Japan is a global economic epicenter. You become a global / regional epicenter when other economies are dep ...more
Answered by A Moin, 23 Nov '09 01:47 pm

 
  
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3.

It may take sometime
Answered by anil garg, 29 Aug '10 12:46 am

 
  
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