Introduction: The Rise of Indian Multinational Enterprises: Revisiting Key Issues

Abstract

The internationalization of firms from emerging markets by means of foreign direct investment (FDI) has undergone a rapid transformation in recent years. Starting from humble beginnings around the 1960s, a number of emerging markets1 have become leading outward investors during the first decade of the twenty-first century. Average outward FDI (OFDI) flows from these new sources of direct investment have grown from just US$348 million in the 1970s to over US$170 billion in the first decade of the twenty-first century; in 2008, OFDI flows from emerging markets reached US$350 billion (United Nations Conference on Trade and Development 2009). The OFDI growth rates of emerging markets are not just high (although starting from a low base); they have even outpaced the OFDI growth rates of developed countries in each consecutive decade since the 1980s. Emerging markets recorded a 57% growth rate of OFDI flows in the period 2000–2008, which is about double the OFDI growth rate of developed countries, as set out in Table 1.1.2 This constitutes a sharp increase in the growth gap of OFDI between emerging markets and developed countries beginning in the 1990s, when the growth rate of emerging markets was merely 1.2 times the growth rate of developed countries, compared to two times the growth rate during the 2000s.KeywordsForeign Direct InvestmentHost CountryBusiness GroupOutward Foreign Direct InvestmentIndian FirmThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.