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Why did India have to open its market to The Coca Cola Company and PepsiCo? I think Indian market is big enough. Moreover, we know the nature of these companies

by mcny 6y ago

Why did India have to open its market to The Coca Cola Company and PepsiCo? I think Indian market is big enough. Moreover, we know the nature of these companies (there was a recent post where the comments said all the local brands dissolved into the multinational corporations once the multinationals entered the market. Is it simply that The Coca Cola Company and PepsiCo have better lobbying than Google/Amazon?

bluGill 6y ago
They don't have to, but it saves them the bother of learning to make their own.
notahacker 6y ago
The Indian market is evidently big enough for homegrown cola brands (as in much smaller countries) but ultimately you have to question how much the Indian economy would benefit from special legislation to force its consumers to buy cola owned by a local oligarch rather than a foreign plc. Since the manufacturing and distribution jobs for the Indian supply chain are all in India either way and making sugary carbonated water isn't something which takes time to learn offering massive future opportunities, the argument for protecting fizzy drinks isn't very strong. Protecting your own industries can keep some domestic spend within the country, but it also tends to reduce foreign investment, lower the product quality/choice and deter exports, unless and until you start developing major strengths in the areas your govt protects. India's present economic strengths and growth opportunities are in its ability to carry out work in the English language and IT sector for a wealthier multinational market: it's not a good bet especially not in the short run to sacrifice those opportunities to try to get Indians to mainly use Indian manufactures. Which is also why you have Google India and Amazon India. China didn't really have that same level of opportunity even if they'd pursued complete economic openness that's entirely alien to their political culture. And most countries smaller than China have been highly selective about which industries and resources they protect and for good reason.

by mcny 6y ago

bluGill 6y ago

They don't have to, but it saves them the bother of learning to make their own.

notahacker 6y ago

The Indian market is evidently big enough for homegrown cola brands (as in much smaller countries) but ultimately you have to question how much the Indian economy would benefit from special legislation to force its consumers to buy cola owned by a local oligarch rather than a foreign plc. Since the manufacturing and distribution jobs for the Indian supply chain are all in India either way and making sugary carbonated water isn't something which takes time to learn offering massive future opportunities, the argument for protecting fizzy drinks isn't very strong. Protecting your own industries can keep some domestic spend within the country, but it also tends to reduce foreign investment, lower the product quality/choice and deter exports, unless and until you start developing major strengths in the areas your govt protects. India's present economic strengths and growth opportunities are in its ability to carry out work in the English language and IT sector for a wealthier multinational market: it's not a good bet especially not in the short run to sacrifice those opportunities to try to get Indians to mainly use Indian manufactures. Which is also why you have Google India and Amazon India. China didn't really have that same level of opportunity even if they'd pursued complete economic openness that's entirely alien to their political culture. And most countries smaller than China have been highly selective about which industries and resources they protect and for good reason.