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RIS DP# 5-2000
Multinational Enterprises and M&As in India:
Patterns and Implications
Nagesh Kumar
Version: 1.1
June 2000
Published in
Economic and Political Weekly, 35, 5 August 2000: 2851-8
Research and Information System for Non-aligned and other Developing Countries,
Zone 4B, Fourth Floor, India Habitat Centre, Lodi Road, New Delhi-11003, India
Phone: 468 2175; Fax: 468 2173;
email: [email protected]
This paper is a part of a larger ongoing work on investment and competition policy at
the Research and Information System for Developing Countries, New Delhi. An
earlier version was presented at the Workshop on Cross-border M&As and Sustained
Competitiveness in Asia organized by UNCTAD in Bangkok on 9-10 March 2000. I
have benefited from discussions with Dr V.R. Panchamukhi and from the comments
of participants. Dr. P.L. Beena helped in preparation of the dataset for this paper. The
usual disclaimer applies.
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Multinational Enterprises and M&As in India:
Patterns and Implications
1. Introduction
Mergers and acquisitions (M&As) have become increasingly important channels of
cross-border industrial restructuring and foreign direct investment all over the world.
In India, the policy liberalization in the 1990s has facilitated M&As including crossborder
M&As. As a result, the M&A activity has boomed over the past few years. In
contrast to nearly all of FDI inflows destined to India taking the form of greenfield
projects until early 1990s, a substantial proportion of current FDI inflows takes place
in the form of acquisition of existing enterprises in the country. The developmental
impli ...