Significant Growth by India and Russia

As per the latest article in the moneycontrol.com it is said that India and Russia lead the emerging markets in the case of Export orders for the Month of April & June eventhough other emerging markets did not show a significant growth. India showed a solid rise in New Orders whereas Russia saw a solid expansion. 

The growth of the emerging market now faces high external uncertainities and we will have to just hope that we stay on the right track. 

In the case of employment also India showed a rise whereas China showed a reduction in Staff , the first time in 13quaters. 

There is a lot of things happening in case of the emerging markets. We will have to wait and watch. 

The main source of the article: http://www.moneycontrol.com/news/economy/india-russia-lead-emerging-marketsexport-order-growth_728991.html 


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Written by Srinivassan R (srinivassan.pgdm14c@greatlakes.edu.in)

Emerging Market Economies (EME)

Hi All,

This post mainly deals with the Emerging Market Economy (EME)

 Emerging Market Economy (EME) was a term coined in 1981 by Antoine W. Van Agtmael of the International Finance Corporation of the World Bank. EME is a country which has an economy of low to middle per capita income. It constitutes of 80% of Global Population and 20% of World Economies (not sure if it refers to 1981 or present term).

EMEs are said to be transitional – they move from closed economy to open economy. They should carry out an economic reform program that will improve the economy of the country. EMEs are more likely to get advice from World Monetary Fund.

Based on Investment factor, an EME will have increase in both local and foreign investment. This is due to the improvement in the domestic economy. It also means that the world has begun to take note of the EME. The investment will turn out to be a big boost to the local government. EMEs are quite riskier in nature. The famous quote, ‘Bigger the risk, bigger the reward’ makes lot of people and firms to invest in EMEs.

Moving from a closed market to an open market is not easy in nature. People inside the country will be apprehensive of the foreign investments. They have distrust over the new people. They feel that the culture of the country maybe affected in the long run.

As a by-product of foreign investment, certain cultures of theirs like Fast food spreads (you may remember the example of how the country has changed from 1980s to 2000s). Over the generations, it may form a completely different society and from that point it is always tough to come back. This is one of the main apprehensions of the local people.

On the basis of GDP, the eight largest EMEs of the world are said to be China, Brazil, Russia, India, Mexico, South Korea, Indonesia and Turkey. World Bank’s report in May 2011 says that by 2025, BRIC countries + South Korea + Indonesia will lead World’s economy with more than half of global growth.

Apart from this, there are lot of lists prepared by various institutes like Columbia University, FTSC, MSCI, S&P, Dow Jones, etc – it can be seen in the Wikipedia link given below.

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This article is a basic one that tries to bring out or explain what an EME is. The sources of this article are http://www.investopedia.com/articles/03/073003.asp#axzz20WUrB95l and http://en.wikipedia.org/wiki/Emerging_markets

Written by

Karthick (karthick.pgdm14c@greatlakes.edu.in) and

Nirav ( nirav.pgdm14c@greatlakes.edu.in)

Introduction to Emerging Markets!

Welcome to the blog on Emerging Markets,

This is platform iniated for all to put forth ones learnings on the emerging markets and 
 discuss on varied  topics related to emerging markets for eg:

• What are the emerging markets?
• Business in emerging markets
• Strategies that fit emerging markets 
• How the BRIC country  economies differ from the economies of US and other developed countries.
• Understanding the country ,industry, farm wise analysis of the emerging market countries.

As the economies of India and china are considered to be the largest economies in terms of rapid growth and industrialization let us start with "India As an Emerging Market". According to a recent survey there are 28 emerging markets of which India ranks in the second place  inspite of the doom stories we hear about Indian economy crashing.

The main factors being the economic liberalization and the perfect competition market, the high standard of living and per capita income, the development of medical facilities and infrastructure, the increase in foreign investments and so on.
 
 Due to the favorable emerging market, more and more industries are being set up and the customer base is also increasing. Currently, India is the 4th largest economic system in the world in terms of the purchasing power parity.

For doing business in emerging market as India one may want to look at many factors which may help in the development or set back of the Indian economy  :

1.Improving Income:  Even small improvements in income, when multiplied across more than a billion people, add up to big money.
2. Indians who want to start businesses have access to local capital — from family members or local banks. The country’s culture encourages enterprise.
3.Every one in 2 lanes we see the roads being in bad condition . The infrastructure is improving, though, slowly but surely.
4. Much of India’s population is poor, but Indian companies have been developing products, services, and packaging to appeal to people who have little cash and small savings and who want to lead a better life.
5.There is extreme poverty and unemployment which may result in the frustration of the energetic young force which may bring the country down.
6.2010-2011 saw scandals where corruption was involved. Thus making it difficult for foreign businessess from investing in India. hence the need to curb corruption.

The following is the link to an Interview with Narayana murthy which we found interesting to share :
http://www.ey.com/GL/en/Issues/Business-environment/Business-redefined---Global-trend-1--the-rise-and-rise-of-emerging-markets---Thinking-big-right-from-the-start


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Written by,
Alekhya (alekhya.pgdm14c@greatlakes.edu.in)

Step into the world of Emerging Markets!

Hi Guys and Gals,

We have created this blog to create a discussion media for the course 'Understanding of Emerging Markets'. Students are welcome to contribute to the blog by means of posts (articles) and comments.

Suggestions for improvement of blog are welcomed. 

For posting comments, you don't need the Login ID. You can use your gmail ID or you can post it even anonymously.

Anyone interested in contibuting to the blog can get the login ID and password from Nirav ( nirav.pgdm14c@greatlakes.edu.in) or Alekhya ( alekhya.pgdm14c@greatlakes.edu.in).

Thanks and Regards,

Nirav and Alekhya