JapanÃ¢â‚¬â„¢s Foreign Direct Investment Experiences in India : Lessons Learnt from Firm Level Surveys
AbstractEver since India decided to globalize, concentrated effort was made to attract Japanese participation through foreign direct investment. However, response from Japan has been rather subdued. This paper attempts to gain some insight into this reluctance of Japanese investors by studying the experiences of eight firms which are either subsidiaries or joint ventures of Japanese companies. The companies that were studied are YKK, Honda Siel Pvt. Ltd, Sona Koyo Steering, Kyocera Wireless India Ltd, Mitsubishi Chemical Corporation PTA India (MCC PTA), Toyota Kirloskar Motor Ltd, Satake India Engineering Ltd and Eisai Pharmaceutical Pvt. Ltd. Key findings of the study are as follows : Japanese companies are long term orientated with a strong commitment to quality and the customer and they try to fulfil this commitment by embedding the Japanese style of management into their operations. Among other factors, Japanese firms seek trust in their partner and each of the companies that have a joint venture in India spent a long time in deciding about the partnership. Labour unions are no longer viewed as a threat, as they have realized that a humane approach to labour guarantees harmony. Skill gap at the lower end of the employee order is a concern and the response has been to participate in skill enhancement. In the telecommunications and pharmaceutical sectors, India has become a potential destination for R&D activity because of its cheap, knowledgeable and capable talent pool. Kyocera and Eisai have taken steps to take advantage of this opportunity. Though there are obstacles that continue to impede smooth operations, the Japanese firms that were studied have acquired a greater understanding of the Indian market, and the Government of India has also stimulated foreign direct investment through investor friendly policies, thus contributing to their success in Indian operations. The achievements of these firms show that many of the perceptions about investing and operating in India are unfounded and/or outdated. The success stories of these companies should help attract more Japanese firms into India.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by East Asian Bureau of Economic Research in its series Finance Working Papers with number 22910.
Date of creation: Jan 2009
Date of revision:
Contact details of provider:
Postal: JG Crawford Building #13, Asia Pacific School of Economics and Government, Australian National University, ACT 0200
Web page: http://www.eaber.org
More information through EDIRC
foreign direct investment; Japanese multinational corporations; strategies; obstacles in operations;
Find related papers by JEL classification:
- F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
- F23 - International Economics - - International Factor Movements and International Business - - - Multinational Firms; International Business
- N85 - Economic History - - Micro-Business History - - - Asia including Middle East
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Harinder Kohli (ed.), 2008. "Growth and Development in Emerging Market Economies," Books, Emerging Markets Forum, Emerging Markets Forum, edition 1, number gdeme, February.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Shiro Armstrong).
If references are entirely missing, you can add them using this form.