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Tata Nano Story

BUSINESS STRATEGY -1

CASE STUDY
ON
THE NANO EXPERIENCE



1. What makes the global business community so sarcastic about Indian corporate? Draw relevance from pre-liberalization scenario.

Ans. India had been a closed economy till 1990 whereby most of the trade and businesses were regulated by the government. The industry was dominated by public sector units, government aided institutions and some business families such as TATA, Birla, Goenkas etc. If one wanted to do trade in India one needed to have license from the government and the economic and trade policies was also quite restrictive. The bank lending rate was also too high so it was very difficult for a new entrepreneur to think about any new business. If one dared it would quite risky. In that arena if any foreign company wanted to do business in India it needed to invest to make a new infrastructure to produce goods either made collaboration with any local company. All these things created a mental inertia in Indian people. Only very few of them which can be counted on fingers dared to think big and succeeded despite of all adverse economic and political environments.
But when Indian economy opened its door by then finance minister Dr. Man Mohan Singh to economic liberalization, the flow of waves of development changed its direction towards India. The GDP rose up with the rate of 6% from 1980 to 2002 and 7.5% from 2002 to 2006. Now it is near about 9%.
Indian companies are becoming major players in their own right. There are over 100 Indian companies with a market capitalization in excess of $1 billion. After years of hand me down technology, the Indian industry is finally shunning the JV route and heading towards Europe and the US to acquire the latest technology in their fields, because the JV partner would never give the Indian partner access to cutting edge technology, thereby always being one step ahead.
Now global business community is so sarcastic about Indian corporate which is...

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