By Indo Asian News Service
Washington, Nov 22 (IANS) Ending decades of isolation Indian companies have returned to global commerce while India-born business executives are climbing the corporate ladders at well-known multinationals, some to the highest rungs, American newsmagazine Time reports.
Indian companies, flush with cash from a booming domestic economy, are prowling for overseas acquisitions to expand their footprints, it says, taking note of last month's $8.1 billion bid by Tata Steel for Anglo-Dutch steel manufacturer Corus and other such deals.
In the first 10 months of 2006, Indian companies cut more than $10 billion worth of cross-border deals, up from about $1 billion in all of 2000, notes the Asia edition of the magazine.
Citing Dealogic, which tracks global M&A activity, Time said Indian companies have this year spent twice as much on overseas acquisitions as foreign companies have invested in India.
'There is a real bullishness' among the leaders of Indian industry, it quotes Sabeer Bhatia, the India-born co-founder of Hotmail, the Web-based email system acquired by Microsoft in 1997, as saying. 'Every Indian CEO is looking outwards to see how he or she can expand their own base and expand into newer markets.'
Besides having deep pockets, many Indian companies have been around for decades; they have got experienced managers who are confident in their ability to run large and complex organisations.
'They're not like start-ups,' says Bhatia, 'so they say, 'you know, our balance sheet is actually stronger than some of our counterparts in London or Europe or America. We might as well buy these brands and make use of our low-cost manufacturing base to branch out into other markets outside of India.''
Indian businessmen are proving to be unusually adept in the international arena. It helps that millions of them already speak English. India is also a free-market democracy with a legal system that, though frustratingly slow, is easy for Westerners to understand, Time notes.
The country has longstanding cultural and trade ties with the rest of the world, which adds 'a comfort factor' to its business dealings overseas, it says citing Andrew Cahn, chief executive of UK Trade & Investment, a government body that supports foreign companies looking to invest in Britain.
To be sure, Indian companies occasionally run into xenophobia and protectionism.
Earlier this year, India-born Lakshmi Mittal's $33.5 billion purchase of Arcelor, Europe's top steel producer, was initially opposed by CEO Guy DollÃ©, who said Mittal's company, Mittal Steel, the largest steel producer in the world, was 'eau de cologne' compared with the 'perfume' of Arcelor.
But India's forays abroad have so far proved less controversial than those launched from that other emerging economic superpower, China.
That's because major Chinese companies are usually partly or wholly owned by government entities, which can raise doubts about their management's motives, Time says citing Sanjaya Baru, an adviser to Indian Prime Minister Manmohan Singh.
'Private companies in India are private,' Baru says. 'They are not an extension of the government.'
Being annexed by India Inc might also be more palatable to some because individual managers and entrepreneurs from the subcontinent are familiar faces overseas. Driven in the past by lack of opportunity at home, India's best and brightest have long studied and worked in the US and Europe.
America's high-tech sector in particular has an unusual concentration of Indian workers. Some 13 percent of all private, venture-backed start-up companies in the US are founded by Indian immigrants, according to a study released this month by the National Venture Capital Association.
Many of Silicon Valley's high-tech leaders are of Indian origin, among them Prabhakar Raghavan, 45, head of Yahoo!'s research division. After finishing college in India, Raghavan migrated to the US and earned a Ph.D. in computer science at the University of California, Berkeley, before joining IBM.
'Indians are looked upon not only as technical wizards but, beyond that as people who can make things happen,' he says.
The diaspora has spread beyond Silicon Valley. India-born executives have in recent years taken the reins at some of the world's biggest companies.
Arun Sarin, from Madhya Pradesh, is CEO of Britain's Vodafone. Three months ago, Indra Nooyi was named CEO of PepsiCo after serving five years as the US beverage giant's CFO.
Indians have credibility as managers, Time says quoting Hemant Luthra, head of the Systems & Automotive Technologies division at Indian car-and-tractor manufacturer Mahindra & Mahindra.
Copyright Indo-Asian News Service