INTRODUCTION

Multinational Companiesy A Multinational Corporation (MNC) or

transnational corporation (TNC), also called multinational enterprise (MNE).. y It is a corporation or enterprise that manages production or delivers services in more than one country. It can also be referred to as an international corporation.

Examples of MNCsy Honda y IBM y Suzuki y Nestle y Johnson and Johnson y Intel y Nissan

Indian Companyy A company formed and registered under the

Companies Act, 1956 (1 of 1956). a company formed and registered under any law relating to companies formerly in force in any part of India (other than the State of Jammu and Kashmir and the Union territories specified in sub-clause (iii) of this clause); i. a corporation established by or under a Central, State or Provincial Act. ii. any institution, association or body which is declared by the Board to be a company under clause (17).

in the case of the State of Jammu and

Kashmir, a company formed and registered under any law for the time being in force in that State. in the case of any of the Union territories of Dadra and Nagar Haveli, Goa, Daman and Diu, and Pondicherry, a company formed and registered under any law for the time being in force in that Union territory.

Examples of Indian companiesy Reliance Industries y Oil and Natural Gas Corporation y Infosys y Indian Oil Corporation y Hindustan Motors y ICICI Bank Banking y Tata Steel Steel y Bharti Airtel

FIVE YEAR PLANS

FIRST PLAN(1951-1956)y The first Indian prime minister, Jawaharlal Nehru presented the first-five year plan to the Parliament of India on December 8,1951.The plan was allocated to seven broad areas, one of them was industry. y Bhakra dam and Hirakud dam were initiated during this period.

SECOND PLAN(1956-1961)y The second plan was focused on industry

especially on heavy industry. y Domestic production of industrial products was encouraged, particularly in the development of public sector. y The plan attempted to determine the optimal allocation of investment between productive sectors in order to maximize long-run economic growth. y The plan assumed a closed economy in which the main trading activity was centered on importing capital goods.

contd

Developments done during this plan: Hydroelectric power projects. Five steel mills at Bhilai,Durgapur and Rourkela were established. Coal production was increased. More railway lines were added in the north-east. Atomic energy commission was formed.

THIRD PLAN (1961-1966)y The third plan stressed on agriculture. y Cement and fertilizer plants were also built.

FOURTH PLAN (1969-1966)y Green revolution in India advanced agriculture.

FIFTH PLAN (1974-1979)y Electricity supply act was enacted in 1975,which enabled the central government to enter into power generation and transmission.

SIXTH PLAN (1980-1985)y Rapid industrial development especially in

the area of information technology. y This plan marked the beginning of economic liberalization.

SEVENTH PLAN (1988-1989)y The plan stressed on improving the

productivity level of industries by up gradation of technology.

EIGHT PLAN (1992-1997)y Modernization of industries was a major highlight of the eight plan. y Gradual opening of the Indian economy was undertaken to correct the burgeoning deficit and foreign debt. y India also became a member of the World Trade Organization.

NINTH PLAN (1997-2002)y The main objective was to create a liberal market for increase in private investment.

PERIOD BETWEEN (1989-1991)y Dr. Manmohan Singh launched Indias free market reforms that brought the nearly bankrupt nation back from the edge. y It was the beginning of privatization in India.

TENTH PLAN (2002-2007)y Economic growth accelerated during this period and crossed over 8% by 2006.

ELEVENTH PLAN (2007-2012)y The objective of the eleventh plan is to accelerate GDP growth from 8% to 10% and then maintain at 10% in order to double per capita income.

A MULTINATIONAL COMPANYExample. JOHNSON AND JOHNSON

J&J headquarters at One Johnson & Johnson Plaza in New Brunswick

TYPE FOUNDED FOUNDERS

PUBLIC (NYSE: JNJ) 1886 ROBERT WOOD JOHNSON 1 JAMES WOOD JOHNSON EDWARD MEAD JOHNSON

HEADQUARTERS AREA SERVED EMPLOYEES

NEW BRUNSWICK, NJ WORLDWIDE 118,700 (2009)

INDUSTRY

MAJOR DRUGS HEALTHCARE SOAPS SHAMPOO PHARMACEUTICALS MEDICAL DEVICES HEALTHCARE PRODUCTS TOILETRIES SOAPS SHAMPOOS

PRODUCTS

PRODUCTS

REVENUE

USD 63.747 Billion (2008)

OPERATING INCOME

USD 16.929 Billion (2008)

NET INCOME

USD 12.949 Billion (2008)

TOTAL ASSETS

USD 84.912 Billion (2008)

TOTAL EQUITY

USD 42.511 Billion (2008)

WEBSITE

www.jnj.com

ENVIRONMENTAL RECORDy Johnson & Johnson has set several positive goals to

keep their company environmentally friendly, e.g. the reduction in water use, waste, and energy use, and an increased level of transparency. y Johnson & Johnson agreed to change their packaging of plastic bottles, due to harmful chemicals used in the manufacturing process, switching their packaging of liquids to safe non-polycarbonate containers.

y The corporation is working with the Climate Northwest

Initiative and the EPA National Environmental Performance Track program. y As a member of the national Green Power Partnership, Johnson & Johnson operates the largest solar power generator in Pennsylvania at its site in Spring House, PA.

AN INDIAN COMPANYExample. HIMALAYA DRUG COMPANY

Type

Private Limited

Founded

1930

Founders

Mr. M. Manal

Headquarters

Bangalore, India.

Area Served

Worldwide Over 67 Countries

Industry

Health Care

Products

Pharmaceutical Personal Care Animal Health 350 Crores

Total assets

e site

.himalayahealthcare.com

A ards

A arded ISO 9001:2000 certification.

Products1. Pharmaceutical 2.Personal Care 3. Animal Care

Hi alaya r g

a y

y In March 2001, the company was granted a Good

Manufacturing Practices Certificate issued by the licensing authority directorate of Indian systems of medicines Bangalore. y Himalaya is the first ayurvedic facility to get GMP certificate in India.

Himalaya Drug Companyy It is the only phytopharmaceutical company whose

ayurvedic products Liv.52, a hepato protective formula, is registered as a pharmaceutical specialty in Switzerland. y The R&D wing of the company has been recognized as a research centre by the Rajeev Gandhi University of health Sciences, Karnataka, India.

y Greater level of employment opportunities. y Better and cheaper products are available to the

consumers. y The government will also benefit by earning more in taxes. y Provide the host country with foreign exchange. y Invention of new technologies. y Strong financial position. y Increase in infrastructure improvements.

y By introducing new technology, MNC s cause

technological unemployment. y They adopt capital intensive technique, so machines replace workers. y Local professional cannot access working strategies of MNC s. y Higher sales cost as compared to Indian companies. y Hurt domestic firms by eliminating competition.

y Less stock market pressure as compared to MNC s. y Cheaper products than that of MNC s. y Provide employment opportunities to local

laborers. y Now listed on the New York Stock Exchange and most of them are on NASDAQ. y Expanded their global outlook by setting up centers globally in the US, China, Japan, Malaysia etc.

y Revenue wise Indian companies are slow growing as

compared to MNC s. y Small in size. y Financial position is also not very strong. y No much monopoly on things like outsourcing, consulting etc.