MBW, a leading Germany based automobile company decided to make India a hub for the company's 100cc (smallest) motorcycle to be manufactured in collaboration with The TWS Group, a leading Indian motorcycle manufacturer t

CS Professional · International Business – Laws and Practices · PYQS · June 2017
MBW, a leading Germany based automobile company decided to make India a hub for the company's 100cc (smallest) motorcycle to be manufactured in collaboration with The TWS Group, a leading Indian motorcycle manufacturer to be exported to the company's home market as well as to other European countries. Describe the favourable effect of such MNC collaboration on Indian economy.

Answer & Explanation:

MBW, a German based MNC has decided to make India a hub for the company's 100cc (smallest) motor cycle with collaboration with TWS Group, one of the India's leading motor cycle manufacturers. This perhaps is for the first time that the mother company will have a bike under 100cc, and the decision to sell the brand across major global markets display plans of positioning it as a large selling volume product. MBW have had some favourable impact on the Indian economy. MBW's collaboration has following favourable impacts. Increase the investment level of our country and thereby the income and employment Act as a vehicle for the transfer of technology which will help TWS group and other manufacturers acting a 'original equipment supplier' (OES) Enable India to increase their exports and decrease their import requirements Make commendable contribution to research and developments due to the MNCs experience. Increase competition and break domestic monopolies Contribute towards the national exchequer by way of duties and taxes Consumers get the choices as per their expectations. Boost up the economic growth of India

Topics: Foreign Direct Investment (FDI)

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