Powerpoint: Indian Economic Conditions

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Country Selection – Use The Hofstede Centre to select one of the countries from the drop down menu, e.g., Bhutan. A useful

photo source is TripAdvisor.

1. Country Background: Use The World Factbook and select the specific country to find answers. (See Milestone One

Rubric and Final Project Document for details)

Building on information from your Milestone One submission and feedback, briefly highlight country features relevant to the

world of international business and commerce, including the following:

1.1 Location, geography/climate, and population

Example: Location: Southern Asia, between China and India

Geography/climate: Rugged, cold mountain areas; temperate uplands and valleys with rivers; tropical plains

Capital city and its population: Thimphu 99,000

Population: 733,643 (July 2014 est.)

Other: Official internet domain for the country is bt

1.2 Language and cultural activities

Example: Major languages spoken: Sharchokpa 28%, Dzongkha (official) 24%, Lhotshampa 22%, other 26% (includes

foreign languages) (2005 est.)

Main cultural activities: Sports, entertainment, music, etc.

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1.3 Quality-of-Life Indicators: Use The World Factbook and select the country:

Example: Bhutan – Life expectancy for total population: 68.98 years total; for males: 68.06 years; for females: 69.95 years

Bhutan – Literacy rate for the total population: 52.8% total; for males: 65% ; for females: 38.7%

1.4 Your Rationale for Your Choice of Country:

Why did you choose this specific country? Include information from the Module Two discussion.

2. Economic Conditions: Use The World Bank and scroll to “Economy & Growth” to answer the following:

2.1 Main types of employment and sector (e.g., agriculture, resource extraction or other primary sectors, manufacturing,

services, government). You may use GDP composition from The World Factbook.

Example: Current GDP (Gross Domestic Product): Use GDP (current US$). Bhutan – $1.780 billion (2012)

Agriculture: 13.8%; Industry: 41.2%; Services: 45%. Unemployment rate – Total: 7.2%; males: 7.3%; females:

7.2%

2.2 Major Imports and Exports:

Example: As percentage of GDP, Bhutan – Imports: 53%, Exports and Services: 35%

Inflation rate for consumer prices (annual %) Bhutan – 10.9%

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3.1 Discuss how the cultural aspects affect business conditions in the specific country:

(See Milestone Two Rubric and Final Project Document for details)

High Culture – Literature and classical music. Use GlobalEDGE and your own research and a country-specific cultural website.

YouTube is also a good resource, especially for music.

Example: Traditional music of Bhutan: Endless Song: Thrung trhong kamoi lu

Folk Culture – Religion, popular music, diet, dress and holidays. Use GlobalEDGE and your own research and a country-

specific cultural website.

Social Culture – Gender roles, greeting rituals, power distance, nonverbal communication, individualism vs. collectivism, and

uncertainty avoidance. Use The Hofstede Centre.

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3.2 Discuss the level of institutional infrastructure: (See Milestone Two Rubric and Final Project Document for details)

3.2.1 Financial environment for business – Summarize relevant aspects, including banking system and two or more relevant

laws for foreign corporations.

Use the currency site GoCurrency.com to find current exchange rate information.

Example: The Ngultrum (BTN) is equal in value to the Indian Rupee (through a 1:1 peg). The current exchange rate: 1BTN

= 0.016.

Use Doing Business, select your country and look under “Starting a Business” and then “Getting Credit.”

Example: Laws that govern the business activities of foreign corporations in Bhutan include money borrowing from local

banks and the law requiring foreign corporations to own a domestic business, which means they are required to enter the

market as a joint venture.

3.2.2 Physical infrastructure important for business: Summarize relevant aspects, including transportation, power, and

communication (e.g., access by road, rail, waterways; stability of power supply; and cellular and internet coverage).

Use The World Factbook and other resources.

3.2.3 Considering institutional infrastructure, which may have the greatest influence on a company considering business

in this country?

Source:

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4.1 Describe the extent of economic integration, specifically mentioning membership(s) within regional trade agreements

(RTA) and their benefits. Use World Trade Organization Regional Trade Agreements to find out the country’s RTA. Select “RTA

Database” and then “By country/territory.” Click on the country on the map and see the detailed trade agreement(s).

Pull up the text of the agreement that explains what the agreement is about.

Example: Bhutan is member of SAFTA. Current economic signatories: Bangladesh; Bhutan; India; Maldives; Nepal; Pakistan; Sri

Lanka. Coverage: Goods. Type: Free Trade Agreement. Objective: Promote and enhance mutual trade and economic cooperation

among contracting states, eliminate barriers to trading, and facilitate cross-border movement of goods.

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4.2 Explain the best ways to do business in this country, making a recommendation for an MNC that is considering this country by evaluating these three options: exports/imports, green field investment, or not to enter at all.

For information, go to Doing Business and see the country ranking (the lower, the better). Look at export information under “Trading Across Borders” and compare it to other countries in the region – is it better or worse? Look at greenfield investments under ”Starting a Business” and again compare it to other countries in the region and OECD.

Example: Bhutan Documents to Export: 9, South Asia 8, OECD 4—this shows us that Bhutan requires more paperwork and bureaucracy than other countries, and it is more difficult to export. In all aspects of the export data, Bhutan was significantly worse than other countries.

4.3 In summary, for a multinational corporation considering business in this country:

4.3.1 What are the country-specific special considerations that a multinational corporation would need to consider?

Countries of the World may be a useful reference.

4.3.2 Would you recommend that an MNC enter this market?

Source:

http://www.un.org/News/dh/photos/large/2012/April/77977_b

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