Business in India Exceed Corporation Term Paper
- Length: 10 pages
- Sources: 10
- Subject: Economics
- Type: Term Paper
- Paper: #45689021
Excerpt from Term Paper :
These other barriers are of various natures and can include social and cultural barriers or difficulties related to an unsatisfactory communications system or transportation network.
From a cultural perspective, the Indian population is highly different from the American one. The people are more conservative and might find it difficult to accept foreigners. However, since the Exceed Corporation is focused on offering their consultancy services to state institutions or the Indian government, they would have little to do with the general population. And also, the Indian citizens are more and more oriented towards the liberalization of their economy. The language barrier would be barely existent since the large majority of the Indians speak English. "English enjoys associate status but is the most important language for national, political, and commercial communication" (Central Intelligence Agency, 2008).
However still underdeveloped, at least in comparison to the United States, the communication systems and transportation networks have been met with major improvements during the past few years, developments which would ease the American company's penetration of the Indian market and would support them in conducting business. The telecommunications are basically centered on highly populated urban areas and the most commonly used gadgets are the mobile and fixed phone. "Recent deregulation and liberalization of telecommunications laws and policies have prompted rapid growth; local and long distance service provided throughout all regions of the country, with services primarily concentrated in the urban areas; steady improvement is taking place with the recent admission of private and private-public investors, but combined fixed and mobile telephone density remains low at about 20 for each 100 persons nationwide and much lower for persons in rural areas" (Central Intelligence Agency, 2008). The increased interest young Indians have for technology has supported and will continue to support technological advancements in India.
From a transportations stand point, India possesses a total of 346 airports, out of which 250 have paved runways and 96 have unpaved runways. They also possess: 30 heliports; 63,221 kilometers of railways; 3,383,344 kilometers of roadways; 14,500 kilometers of waterways and 477 merchant ships (Central Intelligence Agency, 2008).
All in all, the Indian government has instituted numerous barriers to entering the market based on their desire to protect local manufacturers and the domestic economy. However some of these regulations have been abandoned throughout the years due to the intervention of international regulatory institutions, most importantly the World Trade Organization, some still stand. And regardless of how the America service provider feels about these restrictions, they must comply with them in order to retrieve a successful outcome from their operations in India.
3. Product/Service Standards
The product/service standards are those promoted through the Agreement on the Application of the Sanitary and Phytosanitary Measures (SPM) and the Agreement on Technical Barriers to Trade (TBT). These regulations have generally been implemented to protect the safety of the Indian consumers and the general population through the protection of the national economy. "The SPM Agreement gives a right to take sanitary and phytosanitary measures necessary for the protection of human, animal or plant life or health, provided that:
such measures are not inconsistent with the provisions of the Agreement;
they are applied only to the extent necessary;
they are based on scientific principles and are not maintained without sufficient scientific evidence;
they do not arbitrarily or unjustifiably discriminate between Members where identical or similar conditions prevail including between their own territory and that of other Members, and they are not applied in a manner which would constitute a restriction on international trade" (Gupta, 1997)
The regulations, however justly intended to protect the Indian consumer and economy, are not applicable to all products imported, but can easily be adapted to meet other protectionist needs. Take for instance the particular product requirements in regard to proper labeling. It would be rather difficult to apply the same requirements for a service, but in order to make sure one complies with the regulations, they must adjust. In other words, the Exceed Corporation must ensure that their services are properly promoted, presented, placed on the market and delivered to the end consumer. Therefore, the major recommendation the Exceed Corporation must keep in mind is to make sure that they, at all times, comply with the regulations implied by the Indian authorities. The American company may not always understand or agree with the standards, testing, labeling and certification requirements, but they must adjust their internal policies in order to subject to them. For the success in a foreign country is not based solely on the core competencies and high quality of the services delivered, but also by the company's ability to adapt to the particular needs within the country and adjust to the regulations imposed.
The Exceed Company would offer the same products in India as they do in their homeland, adjusted of course to the demands and requirements of the hosting country. It would be however improbable that the American consultant be able to contract the Indian government as a client due to their foreign origins and the authorities' fear of foreign intrusion into their domestic affairs. As such, most of Exceed's services would be addresses to the market of private investors.
The services sector in India has increased significantly during the recent years and the number of companies offering specialized consultancy has also increased. These companies are both local as well as foreign, which managed to penetrate the market due to the reduced restrictions on entry. Currently, the most predominant player on the management consultancy segment is GK Management Services, which offers "management Services with specialization in Business process outsourcing particularly preparation of Tax returns and revenue accounting" (Official Website of G.K. Management Services (India) Limited, 2008).
In comparison to the main competitor on the Indian market, G.K., the Exceed Corporation benefits of numerous sustainable comparative advantages which could easily ensure an increased number of customers among the Indian companies. In this order of ideas, the Exceed Corporation has vast expertise in handling both corporate as well as governmental matters. Then, the company is committed to the full satisfaction of their customers' needs and will work hard to make sure they deliver the best possible results, adapted and customized to the particular needs of each and every client.
The services which could be offered to the Indian clients are organized into four sets: Program Management and Policy Solutions (Program Management Office Support, Management of Program Management Office it Resources, Policy Development and Maintenance and Fleet Management); Acquisition Life Cycle Solutions (Acquisition Planning and Management, Automated Solutions) Research and Analytical Solutions and Records Management and Processing Solutions (Records Management Solutions, Processing Solutions) (Corporate Website of the Exceed Corporation, 2008).
4. Conclusions and Recommendations
The Exceed Corporation is an American-based company specialized in offering management consultancy to state institutions as well as private investors. They are currently considering a territorial expansion to India, a country with particular barriers to entry but with great potential. However the World Trade Organization has limited the tariff barriers, the southern Asian country is free to implement a series of non-tariff regulations which limit foreign investors' access to the domestic market. These regulations are meant to protect the Indian population and economy but make the country one of the closest and most protectionist economies of the globe.
As a valid recommendation for the Exceed Corporation upon entering the Indian market, they should comply with the regulations installed by the state institutions. "Some of the non-tariff barriers can be tackled by the exporters themselves by ensuring that they adhere to quality and standards requirements of the importing countries. For this purpose they need to plan production and packaging methods specially for the export markets.
The exporters need to carefully study the laws and regulations of the importing country and their likely impact on the exports. Similarly they should also carefully examine the notices or notification made by the importing countries under the Agreement on Application of Sanitary and Phyto-Sanitary measures and the Agreement on Technical Barriers to Trade.
The exporters should maintain an effective interaction with their counterpart associations in the importing countries. Any difficulties due to technological or economical limitations must be adequately brought forward to the notice of the Government. This may help the Government to have effective bilateral consultations with the concerned countries and to seek specific dispensation.
Since any dispute in the WTO can be raised by the Governments only, the exporters will do well to fully cooperate with their Government and to provide it with all the necessary information through their association" (Gupta, 1997)
Gupta, R.K., 1997, Briefing Paper: Non-Tariff Barriers or Disguised Protectionism, Consumer Unity and Trust Society International, Number 2
Mehta, R., 2006, Non-Tariff Barriers Affecting India's Exports, Asian Development Bank, India Resident Mission, INRM Policy Brief No. 10
Office of the United States Trade Representative, Foreign Trade Barriers, Retrieved at http://www.ustr.gov/assets/Document_Library/Reports_Publications/2004/2004_National_Trade_Estimate/2004_NTE_Report/asset_upload_file973_4773.pdfon February 12, 2008
World Trade Organization, 2007, India - Trade Policies…