Organizational Dynamics, Vol. 37, No. 2, pp. 190–202, 2008 ß 2008 Elsevier Inc. All rights reserved.
ISSN 0090-2616/$ – see frontmatter
Knowledge Sharing Among High-Tech
MNCs in China and India:
Invisible Barriers, Best
Practices and Next Steps
MARY B. TEAGARDEN
The convergence of size, talent and ambition is
creating a dynamic playing field for knowledge creation and sharing in the Asia-Pacific Region. The importance of China and India is
old news. Combined, the two countries
account for over 38% of the world’s population, and both have declared innovation to be a strategic national priority. In 2006, China
announced plans to become an innovationoriented society by 2010 and a global leader in science and technology by 2050. India proclaimed itself ‘‘The world’s knowledge hub of the future’’ at a 2006 national research and
development exposition. The investment in
building the human infrastructure to realize
these aspirations is extraordinary according to
many popular sources—India graduates over
half a million scientists and engineers each
year. Even more are graduated each year in
China! Collectively, India and China graduate
about 12 times more scientists and engineers
each year than the United States. But aspirations and sheer talent are only part of the story. Foreign Direct Investment (FDI) into
China and India and its impact on the development of the technology sector has been remarkable. According to the Financial Times,
more than 220 multinationals and 120 Indian
domestic companies are currently engaged
in advanced research and development
(R&D) work in India. China’s net inflow of
FDI has increased from $1.65 billion in 1985
to nearly $55 billion in 2004. India’s net
inflows have jumped from $106 million to
$5.3 billion in this same period. This investment has been driven by the competitive advantages found in each market: China in
manufacturing and India in technology services. Much of the FDI and resulting technology transfer into these economies have originated from well-known high-tech
MNCs such as Cisco Systems Inc., Yahoo!
Inc. and Microsoft. Examples of some of the
MNCs active in India and China are provided in Table 1.
As Chinese and Indian industries have
matured, a larger portion of FDI has
migrated to high-technology activities.
Exports from China’s high-tech industry
have grown from a mere 6% in 1992 to over
30% in 2005. Service exports from India’s
information technology (IT) sector alone
increased from less than $500 million to
$17.2 billion in the same time period. It is
not surprising to learn that the U.S. has been
the largest single investor in the Indian economy. Scholars suggest the U.S. provided
Acknowledgments: The authors would like to thank both those who contributed to this study by name and the numerous other executives who generously shared their time and wish to remain anonymous.
HIGH-TECH MULTINATIONALS MOVING KNOWLEDGE INTO INDIA
The Internet bubble created a shortage of computer scientists in the Californian Bay Area, Yahoo’s home. Consequently, Yahoo looked beyond U.S. shores for software engineers. In 2000, they set up a small office in Bangalore, and by 2003 their headcount was less than 20 staff, with the intention to do analytics and data mining—not build products. By 2007, the Bangalore office had 1,000 computer scientists and engineers in Yahoo’s largest R&D center outside of its California headquarters and about 10% of its global workforce. Yahoo’s R&D operation in Bangalore now develops new services for Yahoo users that might be launched globally.
Cisco, the world’s largest maker of network switches and routers, has made one of the largest R&D commitments to India, attracted in part by India’s booming growth in technology and outsourced companies. John Chambers, in a Financial...
...COMPARITIVE STUDY OF INDIA AND CHINA ON FDI
Over the last few decades, China and India have made substantial improvements in the structural transformation of their economies by allowing foreign firms to compete in markets from which they were previously barred. At the outset of reforms, the conditions of both economies were similar, and both were under the influence of the Soviet model, pursuing similar development strategies involving central planning and rapid industrialization. Both leaderships considered the state to be the engine of growth and suspected foreign sector development. In China, foreign investments were prohibited and the mechanism for foreign trade was monopolized by the Ministry of Foreign Trade. In India, the Foreign Exchange Regulatory Act (1974) reduced foreign equity participation from 51 to 40 percent which led to the exit of companies like IBM, Shell and Coca-Cola. Since that time, both governments have significantly liberalized their FDI regimes, however, China has been able to attract a much higher level of foreign investment.
1] Beijing initiated the reform process much earlier than New Delhi and both countries are far more “FDI-led” than other developing countries have been in the past. Nonetheless, the experience of these two large, but strikingly different countries underlies the importance of political economy for growth and...
...Owned by public authorities including central state or local authorities to an extent of 50% or more ii)It is established for achievement of a defined set of public purpose,which may be multidimensional
1. To help in rapid growth and industrialization and create necessary infrastructure for economic development. 2. Promote redistribution of income & wealth 3.Create employment opportunities 4.Promote regional balance development 5. Promote import substitution save and earn foreign exchange for country. 6. Basic Infrastructure (STC, Railways, SAIL)
Organization of Public Sector
•Ministry ( Railway, Finance etc) •Departmental Undertaking (Defense, Post & Telegraph, Defense production unit)
•Statutory Corporation( LIC, AIR India, IFC,RBI,ONGC, etc..) •Central Board (Bhakra Nangal, Hira Kund, Nagarjun Sagar dam)
•Government Companies ( Ashok Hotels, ITI, HMT Hindustan shipyard etc)
Administrative Price : Price fixed by Government
No profit –No loss Price ( DVC, Hindustan antibiotics, Hindustan Insecticides)
Cost Plus Price – ITI, HAL, Bharat electronic Competitive Price
Follow the leader
Privatization: Transfer of ownership and control of an
existing public sector enterprise Privatization may be full or partial. It may be selective i.e.. Some function are transformed to the private sector, which other are retained in public sector....
...Payments from a Comparative Perspective: China, India, and Russia under Globalization
The three regional powers of China, India, and Russia have been actively participating in international trade and international financing recently, although they have large populations, huge territories, and abundant natural resources,1 which would enable them to be independent and autarkic. The globalization movement especially since the ’90s has undoubtedly made their attitudes possible, but on the other hand, the fact that the three regional powers have sailed out on the world market itself has made today’s globalizing trend as a whole stronger and faster. The purpose of this paper is to clarify each country’s similarities and peculiarities in their international financing in a globalizing economic situation by using balance of payments statistics.
Weight of External Economic Transactions in Each Economy
Before analyzing balance of payments statistics, we must examine the size of the external economic transactions of each economy. The simplest way to calculate this is to research the ratio of “openness.”2 According to Fig. 1, the ratio of China and India has been increasing rapidly in the new century, whereas the Russian ratio has stagnated recently after reaching its highest point in 1999. However, we must not exaggerate this contrast because the ratio has always been...
...INDIA VS CHINA
1. India and China fight for Super power tag.The two countries meet face to face only at The Himalayas, all other things for comparison will make stand these two countries individually, at their own socio-economic-political-cultural areas. To know who is super power, India or China or two know each areas of strength and weakness, let’s get into the points of concern for both to become super power.
Military Strength - Conventional and Nuclear.
2. As two rising Asian powers with high GDP growths and increasing geo-political influence, India and China have been arch rivals in their race to superpowerdom. The race for regional dominance between these two countries has also spawned a race for militarization, with India sparing no efforts to match China’s military might. A comparative analysis is therefore overdue, to see how India and China fare against each other in their military strengths. According to United States DoD (Department of Defense) reports for 2006, China’s military expenditure is estimated to be 80 billion US dollars. However, the official Chinese CPC government quote is a $30 billion military expenditure (which a lot of analysts believe is under quoted). The actual Chinese military capabilities and budget are masked in deep secrecy to prevent foreign countries having an idea...
...International business China and India
Chinas population is 1.351 billion, china’s GDP 8.227 trillion USD.
However Indians population is about 1.237 billion, Indian GDP $1.85 Trillion
Gross domestic product (GDP) grew at an annual rate of 7.7% in the October-to-December period, down from 7.8% in the previous quarter.
But it was still higher than the government's target rate of 7.5%.
China is trying to maintain strong growth while rebalancing its economy.
China has said it wants to move away from an investment-led growth model to one driven by domestic consumption.
India GDP growth $1.859 trillion
China: GDP (purchasing power parity): $12.61 trillion (2012 est.)
$11.7 trillion (2011 est.)
$10.7 trillion (2010 est.)
India: GDP (purchasing power parity): $4.761 trillion (2012 est.)
$4.579 trillion (2011 est.)
$4.25 trillion (2010 est.)
note: data are in 2012 US dollars
Foreign Direct Investment in India increased to 2203 USD Million in April of 2014 from 2133 USD Million in March of 2014. Foreign Direct Investment in India averaged 968.10 USD Million from 1995 until 2014, reaching an all-time high of 5670 USD Million in February of 2008 and a record low of -60 USD...
... INDIA Vs CHINAIndia and China are the two giant economies and they are the major players in the world economy. Both the economies are growing tremendously at a skyrocketing pace and these economies have their own specialty. We cannot just judge which economy is better by just comparing one or two factors because they have their own style of working and uniqueness . Here we will discuss about some of the factors that shows the real picture of an economy such as economic growth, currencies, military, inflation, quality of life and GDP.
In an inevitable comparison between two giant economies India is lacking behind in some of the development processes. For example, the poverty rate of both the economies were at the same figure 20 years back but if we look at the rate of poverty now, China has improved a lot as India hasn't eradicated poverty as quickly as China.
Likewise, India has struggled to compete with China in large scale, export oriented manufacturing and foreign direct investment. China has a very good record in export oriented manufacturing because they have used their resources optimally. If we see both the economies have enormous amount of labor resources and China took this as their advantage as the labor cost is cheap and foreign companies...
...India and China
Comparison of Global Trade and Finance
Rise of the Asian Tigers
Section S6 - Group 7: Akrati Bhargava (12DM-018) Anant Modwal (12FN-012) Pushpak Roy (12DM-105) Priyanka Jain (12DM-103) Shweta Bhalla (12FN-124) Soumya Roy (12FN-131)
1. 2. 3. 4. 5. 6. ABSTRACT INTRODUCTION RELEVANCE OF INDIA AND CHINA IN GLOBAL ECONOMY CHINA’S AND INDIA’S ROLE IN GLOBAL TRADE CHINA’S AND INDIA’S ROLE IN GLOBAL FINANCE REFERENCES
2|P ag e
Abstract In today’s modern world India and China are forerunners for the multinationals who are out to exploit low cost highly skilled work forces in these countries or vie for products and services from these two fastest growing markets in the world. China holds more than $1 trillion in its treasuries which cash starved multinationals are trying to make use of finances for investment The rapid rise of these two Asian giants who have combined population of more than 2.4 billion comprising 40% of total and are now racing towards becoming economic super powers is catching attention everywhere. Over the last few decades there has been gradual shifting of economic power centre from the West towards the East. India and China are the world's future major powers. At a time when in a global economy, affected by the financial crisis, most advanced countries are going into recession, both...
...creating and maintaining a well fused organization. We can now examine the Hofstede scores of UK and India as a means to understand likely issues faced by an organization like Vodafone where UK and India are involved.
The Hofstede Global Average on each of the five factors can be basis of reference and against this we can compare India and the UK. The Global Average is a weighted average drawn from developing and developed economies. Bearing this in mind we can develop perspective on Vodafone wanting to set up a corporate entity based in India. The Average scores are:-
Global Average India United Kingdom
PDI 56.5 77 40
IDV- 40 44 85
MAS- 51 56 61
UAI- 65 40 30
LTO- 48 61 20
From management's point of view understanding how the country compares with the world is only an insight and of theoretical importance whereas understanding how both countries compare with each other is of greater practical value in developing strategy.
Power Distance Index (PDI):- India's score is 77 versus (Global 56.5 and UK 40) is extremely good news for Vodafone UK wanting to set up operations in India. India's history has had more of Socialism (distribution of wealth) rather than Capitalism (creation of wealth) and so Indians have not minded so far disparity in power and wealth. In terms of implications the Vodafone...