Global Financial Management

As part of its international expansion program Acme, a U.S. multinational enterprise (MNE), is currently in the planning stages of establishing a Greenfield production facility overseas. By comparison, France is a member of the European Union as well as India although located in South East Asia. The Acme Corporation, which is looking to set up a Greenfield Project in a foreign county my choice, would be India as companies to Finance because of the tremendous Business opportunity offered by Indian markets. In the last few years, India has emerged as one of the fastest growing emerging markets and is

Already one to its large population and tremendous growth sectors and per capita income. There is a Hugh inflow of foreign direct investment in India in all the sectors and more and more global companies are pumping money into the Indian economy to take advantage of the comparative advantage as offered by India. India has already emerged as a Global player in information technology and outsources related activities due to the significant comparative advantage offered by the county in terms of low cost of production adequate availability of qualified and skilled English speaking population and host of other facts such as location advantage which really makes it a unique country to

Indian stock markets have risen like anything in the past ten years and economists have no fear in saying the India will come on board with the U.S. economy on the likes of China. For Acme Corporation, India offer significant comparative advantage as compared to a country like France in the following ways: Market Size; India hasn't only the largest population size as compared to France per capita income an due to significant improvement in the standard of living of the people. Further, the local ideal advantage of India provides a strong base for companies who wish to explore the fast growing markets of South East Asia which includes countries like Pakistan Bangladesh, etc. As compared to France, Acme will be able to step into a much faster growing economy which is slated to become one of the largest economics in the World.

Comparative Advantage; India, due to the cheap availability of skilled as well as unskilled labor and low cost of population, can be developed as a global manufacturing hub for Acme, thereby providing dual advantage for Acme. It is not only much cheaper to set up Greenfield projects in India as compared to France.

Trade Policies; Indian government's attitude and policies towards attracting foreign direct investment in the county is much more favorable, as compared to Europe India has been able to attract Hugh foreign investments in the country from global corporations. The foreign multinationals like Acme have been offered substantial benefits and relaxations to setup operations here. Especially for U.S. companies which are in India's largest trading partner the situation even favorable as