“the Impacts of Fdi on Local Telecommunications Companies in India: Case of Bharti Airtel”

Topics: Investment, Foreign direct investment, Mobile phone Pages: 55 (21929 words) Published: November 18, 2010
The objective of this research is to examine the impacts of FDI on local telecom companies in India: case of Bharti Airtel in order to be able to understand the impacts that local telecom companies in India will face particularly after India opened its economy. Thus, it will be useful for everyone who is interested in FDI and telecom business particularly in Indian business environment as a result of its potential and market size which is the second biggest in the world after China. Besides, currently emerging market is the potential target for many foreign investors which India is included; therefore, it is useful to study Indian market closely for future business. Additionally, Case study of Bharti Airtel-- as one of the largest telecom companies in India, will be useful for small local companies to study its marketing strategies seriously and apply it for adjusting their business to become successful like Bharti Airtel. Moreover, this research also examine the strengths of MNCs like Vodafone, therefore, it also will be helpful for those local companies.


It is clear that Information Technology (IT) relates to telecommunications industry directly, thus, it is not surprise to see the advance of technology contributes the growth of telecom business increase significantly. Especially, in India, where the technology is well-known as one of the best in the world, therefore, telecom business can exploit such competitive advantages extremely. By considering Indian economy since it was opened and became more liberal, since then there are many foreign investors tend to enter into Indian market increasingly as most of them see a great opportunity in this market especially its size as it is regarded as the second largest in the world next to China. Besides, since Indian government has adjusted its laws/regulations particularly tax reduction, results in the demand of mobile users is increase accordingly. Since FDI has taken place in Indian market, there are many various aspects have to be considered in both sides—positive and negative. Notably, high competition has been inevitably taken place since then as most of them including local operators prefer offering cutting price to customers to compete other competitors. It is useful to study how a local company like Bharti Airtel is capable of competing with MNCs in its local market and maintain its market leader position. Furthermore, it is interesting to examine how Bharti Airtel survives in aggressive competition like Indian market even it outsources almost its whole business especially at the beginning of business. Despite, there have been many advantages provide for supporting local companies and attracting foreign investors under Indian business climate, at the same time, some disadvantages also have been taken place to obstruct the growth of this business, which investors—both local and foreign will face inevitably when their business are running in Indian market. One of the key supportive factors is related to the government policies/regulations especially tax incentive. However, it seems the policies/regulations issued by Indian government still unclear and different from each state. As a result, it will not be easy for foreign investors to run business in India easily without studying carefully the policies/regulations relating to their business.

First of all, many thanks to the supporting of Faculty of FCET, Staffordshire University, Staffordshire, the United Kingdom with its excellent infrastructure provided. I truly feel pleasured to be a part of this University. Furthermore, I would like to acknowledge the valuable assist that I received from my tutors throughout the course which assisted me in my dissertation as well. Especially, I would like to thank Des Keiher my supervisor, for his advice on my research. His guidance, encouragement and fruitful conversation have assisted to complete my work as well as many thanks for his...
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