The world that we live in today has progressed dramatically in almost all aspects. Considering these changes and trends in the course of time, we can relate from our observation that international business and its activities also have rather gone in for a change. When we reflect back to certain course of progression, especially international business scenario we can see and subsequently observes the many notable changes in and around us. Important feature to be noted initially can also be surmised towards Globalization and its impact today that have taken its course since the late 80s. In that context, the role and impact of globalization also have tremendously given a new dimension for international business and meaning in all matter thereof. Above all, international business today also designate and defines a hyper activity that have gone for a change altogether. A change for all the good reason though. But what defines international business or the meaning of its concepts? To be precise in that regard, “international business can be understood as to involve the exchange of goods and services across or within international and national boundaries for the sole purpose of commercial reasons. In addition, international business is also understood as an exchange process involving relationships, input and outputs, between social actions located in different countries. And there is every reason to relate that international business can be influenced by certain factors that are noncommercial as well such as social and political scenario, which together is in consideration.” (Mohammad Reza Vaghefi, 1991, p. 4) Assimilating the meaning of international business from the aforementioned definition, we should acknowledge the fact that international business today provides abundant avenues. To top it all, the course of international business in the current state of affairs have advanced to a crucial and critical stage in all matters. What we can relate to the course of international business in the current state of affairs is the notion that understanding its features and the many interrelated factor is also very essentials, so as to drive home the idea. In doing so, we feel it would be pertinent that should be reflected constructively. In that essence, it is pertinent that issues and factor in consideration for the discourse of this work also is clarified. The following paragraph thus relates the issue in consideration.
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Identification of Issue and Objective: An Overview
As we have surmised above to the notion of international business, analyzing its pertinent factors is crucial. In the discourse of this work and its analysis we can relate that international business as a subject study is a hot topic of discussion. Debate, discussion and arguments thus pertaining in favor and against international business also is constantly a matter of attention grabber, given the huge stakes in it. Hence, herein we can relate as to where the significant feature of the subject matter probable arguments stem from. Considering these factors, it should be clarified that the purpose and objective of this work in parts is to trace the relevancy of international and its role today. Comparative analysis thus is one domain that is central to the issue in consideration. To be precise, we are of the opinion that international business scenario today extrapolates an avenues for theories to be implied practically.
Thus, the purpose of this work overall is to reflect upon features of international business scenario, its role and impact. In that sense, India as an international Business destination comes as a preferred country to reflect our analysis. The following questions also stems out:-
What are the relation of relation of India and its participation in international trade and FDI intercalation?
How the stocks, direction, volume and composition on international business scenario take shapes in India?
Who constitutes major trading partner with India? That is to say, the Who who’s on the list of India trade partners.
How treaties, bilateral ties and all in between are integrated and streamlines in matter of internal business discourse?
Subject to these questions, we feel the salient features in it also cannot just be viewed in general. There is reason enough that relating about international business should be based on certain background. In recent times India participation in international business reflects “to the course of India emerging role in international business. Add to it, experts are of the opinion that international business in India today is lucrative enough and provides greater avenues and opportunities platforms. Yet the scope for improvement is also there.” (Anonymous) In conjunction with the above concise historical sketch, we can augment that India today is in a progressive stage of dramatic developments. There is no denying the fact. India and its discussion in international scenario also readily grab attention for the sheer element attached to it. As a developing nations, India today have done exceedingly well enough in maintaining its economic and social growth constantly; subsequently attracting international investments, and extending its socio-cultural and economic relations across international borders. To top it all, the driving force in context of India dramatic rise in international business scenario also can be related to its political environment that have been stable to facilitate ties, trade and bilateral relation, which are crucial to international business to take roots. In the global stage, India today is viewed upon as the rising economic power in the making, and most importantly – preferred investment destinations.
Considering these aspects, we feel it would be prudent that theories of Trade and FDI should be taken as a first course of the structural process in order to assimilate the salient feature of international business and its activity in India, which is as follows.
Theories of Trade and FDI
International business and its discussion is rather complex in a sense. Thus, it is crucial that to understand the meaning of international theory and trend should form a part of this discussion. What we can assume from our observation of international business scenario is the fact that macro and micro-economics play a significant role in international business and its discourse. In that capacity, “macroeconomic theories on internationalization reflect the salient features towards traditional approach to trade and FDI (Foreign Domestic Investment), as well as an interrelated theory on fragmentation. In that essence, it should be understood that macroeconomic theory provides an insight on the basic driving force of economies and its activities, which is thus based upon internationalization and its processes and procedures.” (Vogelsang, 2010, p. 84) Theoretically, the subject relation and pattern of internationalization and its discussion at most instances reflect or combine traditional macroeconomic theories that lay emphasis upon trade and FDI. We can’t deny this fact considering that without relevant trade agreements, ties and FDI the very object of international business doesn’t make sense at all. Moreover, approaches towards international business also verily take a starting discourse from within the domains of trade and FDI. Thus, trade and FDI in context of international business and macroscopic theory forms an important part and foundation of internationalization and its processes.
Hence, understanding trade in one part and common approaches towards FDI is also crucial to drive home the idea. The question that arises thus is what constitutes the features of trade in international business? Laying emphasis on this notion, we are of the opinion that “trade in international business is one important approach. Trade in context of international business and macroeconomic theory defines the notion of purchasing in spot markets without any barrier. That is to say international business approach at the core undertakes and shape trading scenario with other countries within and across international borders. Ricardo model thus is considered to be the best explanation to international trade approach.” (Vogelsang, 2010, p. 84) What is significant to Ricardo model can be reflected towards comparative advantage due to trade. Given thus, different partner are required to carry out trade for comparative advantage and to streamline the process of internationalization. To derive the meaning of it, we feel it should be exemplified to certain cases related to India today. As we are aware, today India plays a crucial emerging role in export and import for different commodities to sustain and facilitate the economic process. Internationalization has opened up large avenues for India to trade with likeminded parties in the international market. Take for instance US, UK, China, etc. Latest news highlight in regard to trade concerning India reflects that “India is more likely to open up dialogue towards bilateral trade and ties with trading partners, which is one central factor of international trade and its policy. Such highlights also reflects India emerging role in internationalization.” (EconomicTimes, 2010)
Apart from trade, considering the salient features of FDI at best can be drawn to the meaning of it in simple form. “Foreign Domestic Investment when approached to international business defines the changing structure of property owners in the country invested in. That is to say, ownership of the course of investment takes a different shape. FDI thus can be differentiated between the following:-
Greenfield investment: It relate to factor such as when a new plant is established in a foreign country.
Vertical integration: Vertical integration to FDI approaches relate to factor of acquisition of supplier along the value chains
Horizontal Integration: Concerning horizontal integration, the meaning of it concerns the mergers of companies from a position of the value chains. In that capacity, the best example that we can cite is the emergence of MNC (Multinational Companies).” (Vogelsang, 2010, p. 84)
Assimilating these theoretical meaning, we are of the opinion that its approaches is also very crucial. Take for example case scenario in India today. What we can relate to Indian Economic process is the mushrooming number of MNC in most sectors and industry. Such a development is good and perfect to facilitate growth, internationalization and to derive the meaning of international business concepts. What we can speculate is that “FDI in India was initiated way back in 1992. In two decade from then, today FDI has played a crucial role in the development of the economy, and to a certain degree enabling India to maintain progressive growth, financial stability and raising the standards of living.” (EconomyWatch)
Considering these aspects as detailed above in context of theories of trade and FDI, we feel India have tremendously had a share of its practical implication in all matter thereof, which we can conclude that FDI and Trade have had a major impact on India Economic process since the late eighties due to the direct impact of internationalization and its process.
Social Cultural Forces: Its aspects and Impacts in India
Culturally, India displays a unique substance and essence when benched marked on the cultural fronts. But it should also be understood that India of the yesteryears and today are two different cultural identities. Speaking, it doesn’t mean to relate the features that India has lost its sheen of traditional aspects, but the change in the cultural domains that have been witnessed all these years that have reshaped the image ion India in international context. In the 21st century today, the cultural face of India displays a sheer combination of improvements in all aspects. Let consider herein the features that can be related towards work ethics and its culture. In that aspect, we are of the notion that the emergence of India and its transgression into international scenario have redefined the scope of its work ethics overall. India today displays a sheer combination of progression all domains of the economy and its processes. As we have related earlier, FDI, foreign Trade, and stocks have progressed dramatically in the current state of affairs that is often credited to the rise of India middle class society. India today is viewed upon as a nation that offers tremendous growth factor when it concern works, given the work ethics that reflects international trends. This is also one attracting features. To top it all, “such a progression in recent times has opened up avenues of possibilities for India to transform its work culture by benefitting directly from international business and comparative management and practices. Above all, skilled manpower and the emergence of powerful middle class in the society today also have given a new dimension to India work ethics that is diverse in its scope and reach.” (Anonymous) Put it to “India growth rate today that is calculated to be at 9%, the very essence of it also mirrors the specific fact of India better work culture” (RAGHAVAN) to have taken shape.
In the second instance relating to India cultural domains in areas such as family, kingship, religion and traditional cultural aspects, its course have also undergone dramatic changes. Yet it should be understood that despite the changes all around, India haven’t part with its traditional cultural identity. India as a nation today displays a sheer combination of modernity with a dash and perfect blend of traditions. That also perfectly defines India social cultural essence, which we can conclude is due to the outcome of direct impact of the internationalization process. Moreover, the economic process in India today can be subjected towards social cultural impact is significant in the effort of sustain growth and maintain constraint development in all aspects of its economic, social and political processes. However, we feel that without relating to the aspects encompassing India Education, health, gender equality and most important people attitudes, the very object of social cultural discussion also cannot be complete. Considering these features, we feel that in the health sector accelerating growth defines the same in India. Justifying the same, we can augment our point by relating towards India role in upgrading its health sector to facilitate better facilities and to derive the direct effect of it in context of international business environment. Entry of “private sector is one important step towards upgrading service quality in Indian health industry. Moreover, the impact of corporatization and comparative trends also has significantly brought about new norms to be followed. Thus, improvements in health related scenario have dramatically improved, wherein the direct impact of internationalization also can be reflected with strata such as the emerging trend of integrating technology, telemedicine and medical tourism.” (TradeChakra) As per available report with CBC news dated way back to 2004, there is a highlight in which it relates that “India is preferred destination for medical activities, be it for individuals form US, Canada or elsewhere. The simple fact to such a change in trends can be looked upon the scenario of Indian Medical industry that has progressed dramatically. To top it all, the cost factor also plays a significant role towards Indian medical industry trends that is fast catching up worldwide and considered to be a multi-billion industry in the making. (CBCNews, 2004)
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As for educational sectors, literary rate among Indian inhabitants today should directly relate to the impact of international process within the socio-cultural environment and its impact. When compared to wards the current state and two decades down the line, India Education sector also improved dramatically in recent times. “Compulsory Education Act passed by the parliament in 2009 signify a serious efforts made by India policy makers to reaps the benefits of Education today. The landmark Education Acts and free Education Policy is with an outlook to facilitate the increasing needs for education among citizens.” (IndiaEduNews, 2009) In addition, “as per India literacy census commencing 2001 there is indication that literary rate have notch an overall 65%, in which male literacy rate is calculated at 75%, whereas for females the literacy rate is 53%. Benchmarking with 1991 census, there is a dramatic improvement in the educational front as well,” (IndiaGovermentReport, 2005) which indicates the rise of India in the global stage. (India Literacy Graph Annexure I attached at the End)
Assimilating these facts, we feel that there is a great scope for investment within the Education or Health sector in India. Above all, the changing demographic also signify India emergence in the international scenario. Hence, considering these aspects, we feel that their role towards international business environment is also very significant. Surprisingly from socio-cultural perspectives, gender equality in India also has gone for a change. Societal attitudes towards women, their role, status and equity have been redefined. “India constitutional impact in that regard also professes gender equality as fundamental rights, which barred the subjugation, disparity and discrimination of women folks in the society. Empowering women and the role played by India policy makers also signifies an emergence of India in the international platform.” (AzadIndiaFoundation, 2010) Thus, what we see today in and around are the rise of women power within the corporate sectors, where their role is being recognized as befitting towards socio-cultural developments.
Thus, accumulating together the analysis as stated above, we are of the opinion that India social and cultural forces, its impact and aspects have given a new dimension in context of international business environment.
Natural Environment and Sustainability
In international management and its study, understanding the relationship of natural environment and sustainability is also one important attribute. Hyper international activities today rings back the crucial element and question of natural environment and sustainability. Likewise, it should also be acknowledged that “natural environment is often a critical factor, given that it is the source of support for everything used in business, such as – sources of energy, life sustaining factors and other elements. Hence, the natural environment in all instances determines what can be done in the society and how institutions can functions. Above all, resource availability is the most fundamental factor in the development of business in societies” (Cherunilam, 2007, p. 112)
We feel the natural environment in contemporary India have rather gone for a drastic change in all aspects. Aas per available reports, “India land area is a vast coverage of approximately 1,229,737 sq. mi. That is to say, land area coverage in India is about 3,287,590 sq. km approx. The climatic condition in India varies from tropical to temperate in parts of India geographical locations. The topography of India is surrounded by the Deccan plateau in the southern region, deserts in the western region and the Himalayas in the northern region.” (IndianChild) To top it all, “natural environment infrastructure is India is also in a developing stage, with much scope for further development. The infrastructure for water supply, ground water management is in tune with the current need and requirement of the contemporary trend. However, the sad state of affairs is that sustainable features are yet to derive it course. Although green revolution in India has started way back since the late 80s, but most of its impact is within the agricultural domain, considering that India is an agricultural country.” (Chandra, 2004, pp. 127-130) But what is not surprising to note is the fact that since independence industrialization has transformed the natural development course of India. In all instance, the combining discourse towards natural environment and sustainability is a major things that gets policy makers a hard time. What we can relate to the point of natural environment and sustainability in India is the fact that increasing urbanization has brought in it the baggage of many harmful effects. Yet we can be sure to speculate that Indian natural environment that influence international business is well balanced. However, much grounds work need to be initiated to propagate a sustainable development course that can further rings in the benefits for the society.
The important aspects of natural environment in maintaining sustainable growth in facilitating the process of internationalization cannot be brushed aside. To top it all, Scholars also have asserted that “at the course of any social system is the natural environment and the available technology. In that aspect, these factors also define the possibility of human actions in the society.” (Cherunilam, 2007, p. 112) The good news is that Indian policy makers are realizing the impact of globalization; both negative and positive features, to have subsequently initiated certain grounds rules to asses the natural environment constructively and to propagate sustainable development course as a measure. In the context, Environmental Impact Assessment (EIA) in India defines the purpose and scope of it through its process that translate into impact assessment that is officially recognized towards an essential exercise in the course of implementing development projects. The formation of Department of Environment in India in 1980 is also with the sole aim to access factor that can harness sustainable development in tune with internationalization.” (Ghosh, 2003, p. 247) We can further comment that, “India is fortunate enough to have the richness of its natural resources and abundant diversity of living resources. Thus the need of the time is to adequately manage such aspect of natural environment, in order to harness the development course for all time. The salient feature in that essence also can be laid emphasis to the degree that a nation can prosper only when resource of the environment is utilized efficiently to satisfy human needs and expectation.” (Ghosh, 2003, p. 313)
Assimilating the abovementioned discussion, what we drive home from the idea on natural environment and sustainability in context of international business can be related towards the trends that have shifted towards ethics in discourse, and factor the determines the course of business to flourish and take course. We are aware that increasing internationalization has also added up a bundle of ethical issues to crop up. One example in that regard is the diminishing factor of natural resources and its reserves. Due to internationalization, environmental concerns also have increasingly grown. Cases as such can be reflected towards global warming and its effects due to direct impact of international business and its increasing activity. Moreover, increasing dependent of the modern society and nations upon natural resources also have threaten to change the very face of the natural environment, such as natural reserves of fossil fuels; impacting the ecological process and physical phenomenon in due course. Finally what we can conclude is that policy makers in India are facilitating the right course of action to harness the impact of globalization, which posits the point of natural environment and sustainability.
Economic and Socio-Economic Factors
In international business, economic and socio-economic factor also plays a significant influential role. To be precise, we are of the opinion that the economic process today is governed and influenced by social forces. There is no denying this fact. What is relevant to the study of socio-economic forces can be laid emphasis to the notion that social trends and its impact directly have a role to play in socioeconomic process. But what are those social forces that directly shapes the determine norms to the economic process? To top it all, do social institutions also constitutes a part of the process? To this notion, the answer is yes, given that social institution today has a major and central role to contribute towards socioeconomic integration and its processes. To identify social forces, we should understand that much of it is related to posit a factor or force that has a direct relation with social phenomena with the capability to cause change in all forms of its interaction processes. Assimilating this notion we bring to the subject discussion that social forces can either be identified with the cultural, institutional and other aspects.
Speaking of institutions, we are aware that their presence and role in the society today is central. In India for instance, institution to a large extent influence the socio-economic process. We are aware that India is a democratic nation. Hence, impact and direct interaction of social institutions almost make a mark in all aspects concerning economic process. Take for instance a bank, as an institution play a major part in facilitating economic process, and yet bridge a way to internationalization processes. Without financial institution, the unsanitary economic discourse would not have been possible. To top it all, the role media plays in India and elsewhere also directly influences the social phenomena in one form or the other. As we are aware, in international business Public relation is a major part of the overall consideration. Through media forms awareness can be facilitated concerning many crucial facts and significant discourse.
Thus, what we see is that advancement in technology also often rings in the social change process, and trends to take shape. In that regard, socio-economic process finds its consideration to the change in patterns and attitude of people to certain phenomena. In that regard, policy makers also find a hard time to bridge the gap that arises due to socio-economic aspects. In India the same phenomena is also being observed, especially relating to technology and its impact. What we can reflect to this notion is the fact “that technology advancement is often known to further extend the gap between rural and urban development. For example, the case can be traced to the extensive use of internet in urban households. However, benchmarking it with rural households there is a large gap, which often worries policy makers today.” (Wal J. Taylor, 2003.) In that essence, we can trace as to how the socio-economic factor determines the course of actions and likewise. We are aware that contemporary India and the emergence of institutional role have facilitated and assist the country to harness the opportunities of globalization. What the social institution have played in India can be reflected towards the governmental agencies “and their policies. It is through the interaction of the social institution that policies such as economic linearization have seen the face of daylight in India. To top it all, policies related to foreign trade, investment and political participations also have been possible due to the simple facts of institutional role in all instance. Thus what we can drive home the point in that regard is that through social-economic interaction, India today have been able to harness the befitting force in facilitating economic, social, and political growth and development. Fact sheets available with CIA fact book also trace the important element attached to the discussion in this regard.” (CIAWorldFActBook, 2010)
Assimilating the above discussion, we feel that social institutions be it government agencies and the likes have played a significant role to influence the process of economic activities in India. To cite an example again, we feel that governmental body and their agencies through the formulation of policies and other agenda facilitates economic integration directly. It is through policies that bilateral ties trade and other aspects in the list of economic and social agenda are being realized through the actions of policy makers and larders. The role that government bodies plays today in a democratic nation is also one of the many course that defines the socio-economic factors. Institution itself can be in many forms that define the aspects comprising organizations; the interaction between people and the likes.
Moreover, as we are aware political process also take its course and actions in all aspects of the social and economic process. In current state of affairs in India the same phenomena also can be witnessed. That is why we see a heightened sense of political origination concerning international business and its discussion. The role that Indian leaders play in facilitating ties, bilateral trade and other features of agreements in the international body also can be laid emphasis in context of the social-economic process. As we have detailed in the earlier discussion, political bodies and government agencies also helps to streamline the economic process through their activities in all instances. The point that we want to argue can be laid emphasis towards situation being undertaken in discourse, and subsequently policies being reached out to carry out actions in practical terms.
Thus, what we can conclude to the features of this part of the discussion is the fact that social institutions, be it public, private, governmental or NGOs in all instances influence the economic process of a nation. Hence, understanding the socio-economic forces that play a significant role in contemporary India in integral to derive the meaning of it in one form, and to drive home the idea that economic and social factors often determines the course of international business, its interaction.
Political and Legal Environment
What is political and what is legal are two different features of the meaning and their term. By political we can simply lay emphasis to the aspects encompassing political institution as such. Hence to ring back the meaning of political forces, we feel the best example can be laid emphasis towards governmental bodies, political leadership and the form of democracy in that regard. Often than not, we found ourselves speculating why political forces decides the course of economic process in the global economy today? Would not we have been well off if there have been no interference for political force? To reach our point in that regard we feel it can be the greatest misrepresentation and misunderstanding. There is no question that society today can flourish without any interference from political forces. That world that we live in today also makes it more relevant for political forces to form a part of the process. Without political forces and their interference, the world would have been in shambles. Thus, the important features of political forces can be traced.
India as a democratic nation has come a long way since the first act of parliament was established. Above all, in context of international business, political force and their influence is one important feature. For a foreign investor or businessman, understanding the role of political force in India can help dramatically in facilitating a course that is legit and in the right earnest. What is crucial to the notion of political force in India in context of international business, or likewise can be looked with the aspects encompassing political interaction. As we can relate toward “Indian political business discussion, we should initially understand that the discourse of it is complex. Evolving political and business landscape in India in recent time can be traced to the role political leaders and their leadership have played, nationally and internationally to influence the process. In that regard, we are of the opinion that without any political forces, landscape to facilitate and tapped the impact of globalization also would not have been possible. Crucial point in that regard can be traced back to the
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