Meeting the MNC Challenge: Are Indian Firms Competitive Enough

The objective of the paper is to ascertain whether foreign firms display superior performance in the marketplace as compared to Indian owned business units. The emphasis is on the branded product. The paper, on the basis of specified parameters, concludes that even with higher productivity, foreign firms are unable to secure a distinct niche in the market place. The reason is that the foreign firms have limited presence in some higher growth areas. However, MNCs can pose a challenge once FDI enters the country in a big way. To meet competition from the MNC, Indian firms need to emphasise on product innovation and adopt constant technological upgradation as an integral part of corporate planning. Besides, there is need to continuously rework on factors such as price and performance in order to enhance the brand appeal. It is also desirable to address social and cultural factors to draw the customer to the branded product. Above all, domestic companies need to be accorded a level playing field to compete with foreign firms on equal terms.