Internationalization of Indian Firms: Regionalization Patterns and Impact on Performance

Abstract

We investigate the internationalization pattern and performance of Indian firms. We first discuss the regionalization trend evident in the internationalization of Indian manufacturing and service firms over time. Next, we empirically test the impact of degree of internationalization on firm financial performance of Indian firms. We also test the moderation effect of business group affiliation on the internationalization–performance relationship. We find that Indian outward foreign direct investment has been shifting from developing to developed economies over time. Also, firm performance of Indian firms is positively related to the degree of internationalization and that service firms profit more than manufacturing firms from internationalization. Business group affiliation reduces the positive effect of internationalization on firm performance.

Citation

Kumar, V. and Gaur, A.S. (2007), "Internationalization of Indian Firms: Regionalization Patterns and Impact on Performance", Rugman, A.M. (Ed.) Regional Aspects of Multinationality and Performance (Research in Global Strategic Management, Vol. 13), Emerald Group Publishing Limited, Leeds, pp. 201-219. https://doi.org/10.1016/S1064-4857(07)13009-6