.CASE BELOW

From the Closing Case from Chapter 8 Foreign Direct Investment in the Indian Retail Sector; List main points that particularly relate to changes in FDI opportunities into India.

5. The International Product Life-Cycle Theory goes through various changes during its life cycle. Changes occur in the nature of production and sales from beginning to last of its cycles. What is the key/major finding of this international theory in regards the ultimate change in production and sales location over its life cycle according to the theory.. Note: We are not dealing with the general marketing product life-cycle. (Answer in one compound sentence only should be enough) Answer:

6. a. From the textbook, what are the two main points made by Krugmans New Trade Theory? 1. 2.

b. Does Krugmans New Trade Theory support the concept of comparative advantage or not support? Why or why not? (two sentences) Answer: Yes or No and why:

Hofstede isolated certain dimensions that he claimed characterized the cultures of different countries thus influenced business culture. According to the textbook, there a two new cultural values framework models that have been researched, examined, and are gaining academic and business support recently. Please name the two new models from the textbook reading. (these are not additional dimensions to Hofstedes work)

1.

2.

"By 2011, the Indian federal government had come to the conclusion that foreign investment in retailing was needed to improve Indias supply chain, increase consumer choice, and help farmers bring their products to market. This view was supported by much of Indian industry, which saw the modernization of the retailing sector as an important condition for contin-ued economic development. Clearly, the government believed that greater foreign capital and technology would help India grow its economy. In late 2011, the Indian government announced a plan to reform for-eign direct investment regulations. The plan was to allow foreign multi-brand retailers such as Walmart and Tesco to open retail stores, although they would be limited to a 51 percent ownership stake. At the same time, the government stated its intention to allow single-brand retailers to set up wholly owned stores, although anything over a 49 percent foreign owner-ship stake would still require formal government approval. These plans were greeted with strong opposition from small retailers and rival political parties, and the government was forced to temporarily shelve them. In early 2012, the Indian government managed to secure approval for plans to allow foreign single-brand retailers to open wholly owned stores, but imposed the requirement that a single-brand retailer had to source 30 percent of its inventory from India. One of the first retailers to respond to these changes was IKEA, which announced that it would invest $1.9 billion and set up 25 stores in the country. More generally though, many analysts viewed the 30 percent sourcing requirement as a major impediment to en-tering India. Both Apple and Nike, for example, would have to establish significant production facilities in the country in order to meet that require-ment and set up their own brand stores.In early 2018, the government modified the 30 percent requirement, giving single-brand retailers five years after their initial entry to reach the 30 percent figure. The government also allowed single-brand retailers to establish wholly owned subsidiaries without having to go through the cum-bersome government approval process. In late 2012, the federal Indian government allowed foreign investors to open multi-brand retail stores in India, but limited ownership to 51 percent. Moreover, in a nod to the strength of the political opposition, the federal government made this requirement subject to approval by individ-ual states within the country, allowing some to opt out. Several states have done so, which reduces the attractiveness of India as a market for foreign retailers. At the same time, India has allowed 100 percent ownership of online retail marketplaces in India. Amazon took advantage of this to enter the country in 2014 and has committed to invest $5 billion in India. Unlike in the United States, however, Amazon does not sell goods that it has taken ownership of because that would classify the company as a multi-brand retailer, limit its ownership stake in Indian operation to 51 percent, and re-quire it to take an Indian partner. Instead, Amazon only sells goods offered through its marketplace platform by third parties. However, Amazon is in-vesting heavily in fulfillment centers and logistics infrastructure to enable it to deliver goods efficiently to Indian customers. Its investment may help to boost the efficiency of supply chains in the country."