2006 2007 %change

Exports in - 52560.85 17.8%

RS (cr)
Exports in 9806.69 13302.17 35.65%
$ (m)

Cumulative April October %change

value of
exports
RS(cr) 347793.9 324863.93 7.06%
$ (m) 85583.3 70792.52 20.89%
 The rising middle income groups of
consumer in India and their spending
levels of consumption-related items have
resulted in a faster rising imports demand
in the country.
PRODUCT EXPORT % PRODUCT IMPORT%
AGRICULTURE 10.2 PETROLEUM 29.5
ORE AND 5.2 CAPITAL 15
MINERALS GOODS
ENGINEERING 20.7 ELECTRONIC 9.5
GOODS
GEMS AND 15.1 GOLD AND 7.6
JEWELLERY SILVER
TEXTILE 14.5 PEARLS ETC 6.1
CHEMICALS 11.6 CHEMICALS 5.7
LEATHER 2.6 COKE AND 2.6
COAL
HANDMADE 1.2 EDIBLE OIL 1.4
CARPETS
PETROLEUM 11.5 PROFESSIONAL 1.3
PRODUCTS INSTRUMENTS
AND OPTICAL
 If net exports are positive, the nation's GDP
increases.
 If the quantity of imports increases, this will
reduce domestic demand pull inflation. So a
rise in import spending, reduces consumer
spending on domestic goods and so reduces
domestic inflationary pressure.
 The other effect is that a rise in imports will,
cause a depreciation in the exchange rate.
This is because domestic firms supply more
pounds to be able to buy foreign imports. This
rise in the supply of sterling causes a
depreciation in the pound.
 A depreciation in the exchange rate tends to
increase inflationary pressure because:
COUNTRY INCOME ELASTICITY OF IMPORTS
Japan .35
UK 2.51

COUNTRY income elasticity of export

US .8
ITALY 1.6
 The price elasticity of demand for U.S.
manufactured imports has been
estimated to be about 1.06 both in the
short run and in the long run.
 1% decline in the dollar price of U.S. imports of
manufactured goods can be expected to
lead to U.S. imports of manufactured goods
can be expected to lead to a 1.06% increase
in the quantity demanded and thus leave their
dollar value practically unchanged in the short
run as well as in the long run.
 the price elasticity of demand for U.S.
exports of manufactured goods was
estimated to be 0.48 in the short run and
1.67 in the long run.
 1% decline in the price of U.S. exports can be
expected to lead to an increase in the quality
of U.S. manufactured goods exports of 0.48%
within a year or two of the price change and
1.67% in the long run (i.e in a period of 5 years
or so)
 a decline in U.S exports price leads to U.S
earnings from manufactured exports to
fall in the short run and to a rise in the
long run.
 the income elasticity of demand for
imports was estimated to be 1.94 in the
US
 1% increase in the U.S. income or GNP can be
expected to lead to an increase of about
1.94% in U.S. exports.
 U.S. imports are normal goods and
exports can be regarded as luxuries.
 The price and income elasticities of
imports and exports are important to
individual consumers and producers in
the U.S and abroad, and they affect the
level of economic activity in all the
nations engaging in international trade.
 The higher income elasticity of import
than the income elasticity of export
points out the trade balance
deterioration.
NO HAGGLING
VALUE PRICING
IN CAR BUYING
 GM- hope 1994 model will increase
market share and profits
 1994 Pontiac grand pix price was less
than 1993 buick Le Sabre model
(without airbags)
 Sales 1 15% but profit margin
 Stimulating
 Time honored
 Intimidating
 humiliating
 Dealers perspective-Customers simply
take the offer elsewhere and use it to
negotiate a better deal.
 Advocates perspective-dealers can
avoid being undercut by combining one
price selling with value pricing and
accepting smaller profit margins
THE RISE OF THE
GLOBAL
CORPORATION
 Twentieth century- global and ststeless
corporations
 Research and production facilities, work
and hire internationally
 Companies that were entirely domestic
and merely exported some of their
output as late as a decade ago are now
finding that in order to remain
competitive they have to become
global players .
 Trend towards global corporation is
accelerating
 Going global has become an essential
competitive strategy
 Becoming insiders in most major markets
rather than mere exportes
 Formation of joint ventures with foreign
countries
 Selling more products in abroad (other
than where headquarters are located)
and earning more profits.
THE INDIAN
GLOBAL
BUISINESS
LEADER
 Indian business leaders are taking
charge at global giants.
 2006
 Pepsi co .-CEO- Indra Nooyi
 Out of 196 countries of the world , HOW
indians are leading in being the global
business leaders?
2007
 ADOBE systems-CEO Shantanu Narayen
 CISCO-chief technology officer-
Padmasree warrior
 Mittal-Arcelor merger and the Hutch-
Vodafone deal
 Arcelor became the largest steel
producer company with 10-12% market
share globally.
 Chief input for business strategy
 Keeper of organizational culture
 Guide or teacher for employees
 Indian leaders tend to focus much more
on internal issues — on people
management, motivating employees
and so