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Changed the Indian business context from one of state-centered, control orientation, to a free, open market orientation - especially for hi-tech companies.
It allowed Indian companies to start competing effectively on a global scale.
India's software exports increased from US$ 128 million in 1991 to US$ 6.2 billion in 2001. India's domestic software sales increased from US$ 115 million in 1991 to US$ 2 billion in 2001.
IMPACT ON INFOSYS
The company grew from Rs. 1 million and 12 employees in 1982 to about Rs. 90 million and 300 employees in 1992, to Rs. 19.5 billion and over 10,000 employees in 2001.
BENEFITS TO CORPORATIONS
Decentralization of power to regional and state offices led to speedier decision-making and reduction in friction to business. Market determined pricing of Initial Public Offerings (IPOs) made equity a viable financing option. Current account convertibility removed restrictions on availing foreign currency, led to easier foreign travel, and facilitated hiring of foreign consultants and international branding efforts. Entry of multinational companies enhanced the competitive environment for Indian companies, thus, forcing them to benchmark themselves against global standards.
SUBSTANTIAL BENEFITS
Reduction in the interference of the bureaucracy, enhancement of the confidence of Indians in exploring global markets, and India emerging as an attractive destination for Foreign Institutional Investors (FIIs). Governments have introduced measures to improve the speed and flexibility of decisionmaking of corporations. These include measures such as allowing listing on foreign exchanges, and formulating acquisition norms as well as regulations for Employee Stock Option Plans (ESOPs).
LATHA PILLAI
RUCHIKA SHRIVASTAV VAIBHAV PATHAK VASU JAIN (55) VISHAKHA AGARWAL (56)