FDI

Globalization of Foreign Direct Investment in India:

1900s–2000

Dr. Amar KJR Nayak♣

Abstract

The paper focuses on the evolution of the liberalized economy in India and the

globalized structure of FDI in India during the last century, 1900s-2000. Based on the

major milestones in the history of FDI in India, the paper provides a systematic

periodization of the history of FDI in India. Through this periodization, the paper

presents the processes and dynamics of globalization process of foreign direct investment

in India. The study reveals that today’s liberalized economy and globalized structure of

FDI in India have been an outcome of the adjustment and alignment process of the Indian

Government to the dynamics of the various domestic and international pressures and

global competition since the 1900s, and it is not merely a phenomenon of post 1991 as

popularly perceived. The rapid change and development in FDI Policies in India in the

post 1991 are only the manifestation of the change processes of the past and the

enhancement of the changes adopted in the past.

♣ Dr. Amar KJR Nayak is an Associate Professor at the Xavier Institute of Management, Bhubaneswar. Orissa. India.

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Globalization of Foreign Direct Investment in India: 1900s–2000

India has been a host to Foreign Direct Investment (FDI) for over a hundred years

now. However, it has drawn special attention in the one and half last decades and

Globalization in India has been seen as a phenomenon of post Industrial Licensing Policy

of India, 1991. Despite the long history of FDI in India, the literature on FDI in India

does not fully explain the processes and the dynamics by which the present ‘Liberalized

Economy’ and ‘Globalized Structure’ of FDI in India has evolved.

The main focus of my research is to explain the process by which the present

‘Liberalized Economy’ and ‘Globalized Structure’ of FDI in India has evolved. By

Liberalized Economy, I mean the extent to which the Government of India has permitted

free hand to the foreign companies in choosing the type of FDI and the level of foreign

ownership in their Indian operations. From a British controlled economy, India adopted a

mixed policy of state run firms and private firms and later moved to more of a market-

controlled economy.

By Globalized Structure of FDI, I mean the extent to which FDI in India has

been globally represented. U.K. has been the dominant investor in India during 1900s to

1960s. Japan became a major trading partner during 1919 to 1941. USA and Germany

became major investors during 1960s to 1980s. However, in the last two decades, the

distribution of FDI has significantly increased from countries from European Union and

Asia and Oceania making the present distribution of FDI highly globalized.

The study reveals that today’s liberalized economy and globalized structure of

FDI in India have been an outcome of the adjustment and alignment process of the Indian

Government to the dynamics of the various domestic and international pressures and

global competition since the 1900s, and it is not merely a phenomenon of post 1991 as

popularly perceived. The rapid change and development in FDI Policies in India in the

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post 1991 are only the manifestation of the change processes of the past and the

enhancement of the changes adopted in the past.

This paper has been presented in five sections, viz., Research Methodology,

Literature Review on FDI in India, Period Studies consisting of six periods viz., 1900s-

1918, 1919-1942, 1943-1961, 1962-1977, 1978-1990, and 1991-2000, Summary and

Conclusion.

I. Research Methodology

This study of history of FDI in India primarily relies on an empirical study of the

developments of FDI in India during 1900s to 2000. The FDI data for this paper has been

collated and triangulated from various University Archives, Company Archives, Public

Libraries, and National Archive in India and Japan to validate the data. The sources

included secondary data, published reports of British Government in India prior to 1947,

Government of India (GOI), Government of USA, Government of UK, Government of

Japan, and a few foreign companies. These secondary data were supplemented and

updated with unpublished data from GOI and a few foreign companies in India. The

study also involved the interviews of senior executives from various foreign companies in

India and a few officials from the Government of India.

II. Literature Review

Foreign Direct Investment1 (FDI) in India can be traced back to early 1900s.

However, despite such a long history, literature on FDI in India is limited in data on FDI

and scope of previous studies. First, there are a number of discontinuities in data on FDI

1 Investments from foreign sources usually fall in two categories viz., Foreign Direct Investment and Portfolio Investments. Reserve Bank of India guidelines also classifies foreign investments into three types viz., (1) Foreign Direct Investment, (2) Portfolio Investment, and (3) Issue of Global Depository Receipt (GDR) are the Euro Issues by Indian Companies. Our study primarily focuses on FDI. However, in the pre-colonial period there is no clear distinction between FDI and Portfolio investment and the Euro Issues are only a development of the last few years in the 1990s (Krishnan, 2003)

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to India during the last hundred years. Barring a few time zones like 1948-61, 1971-78

and 1991 onwards, the existing literature has not documented the complete history of FDI

in India. More often than not, data in one secondary source do not match with that of

another source.

Second, the scope of different studies on FDI in India has been limited. Most of

the existing studies on FDI to India have either focused on the amount of flow of FDI to

India or focused on the impact of FDI to India. Recent literature on FDI focuses on flow

of FDI to India since 1991 and its impact on the Indian economy. Some studies have

discussed the impact of FDI in India during the period 1948-61 (Kidron, 1965, and

Kurian, 1966). The study of Wilkins (1994) indicated that the flow of FDI to India during

the period 1921-29. There is another study that estimated the flow of FDI to India during

1971-78 (Athreye and Kapur, 1999).

There have been a few studies that have dealt with the performance of foreign

firms in India. It is argued that British firms in India succeeded in the early decades of the

twentieth century because of their nexus within the British Government in India (Bagchi,

1972). Another study argued that British firms failed in the post 19472 period because of

their short-term operational structures that they had created in the pre 1947 period

(Tomlinson, 1989). It has also been argued that foreign firms failed in India because of

the nexus of local firms, local financial institutions and Government of India

(Encarnation, 1989). In these studies both success and failure of foreign firms in India has

been attributed to the local Government.

There is a general notion that the inward FDI to India started after the Industrial

Liberalization Policy, 1991. Further, the huge influx of inward FDI to India has been

attributed to the above policy of 1991. It appears as if the dynamism of inward FDI has

been planned and implemented by the Government of India and the role of foreign

multinational companies, foreign governments and international agencies had hardly been

2 In the year 1947, India became independent of the colonial rule of British Government. The regulatory framework of India changed when it moved form being a colonial state to being an independent state.

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explained. In short, we find that the existing literature on FDI in India falls short of

providing a comprehensive understanding of the nature and the context of FDI in India. It

is in this context that the need to study the history of FDI in India arises. The character

and content of FDI in India and how India as a host country have evolved during the

twentieth century is the focus of this paper.

III. Period Studies: FDI in India, 1900s-2000

Each of the period studies focuses on three issues viz., overall socio-economic

and political situation in India, industrial policy and FDI policy in the country and nature

and pattern of direct investments by foreign firms in India.

FDI in India, 1900s-1918

India was an agricultural based economy during this period. People in the

country largely depended on agriculture. The main commercial crops produced during

this time were cotton, tea, and jute. The domestic business had begun in some measure as

the number of joint stock companies increased from 1550 in the year 1904-05 to 2668 in

the year 1917-1918 (Department of Commercial Intelligence & Statistics, India, Report

on Joint Stock Companies, 1924). India was a colony of United Kingdom during this

period and India was rather a stable colony with abundant natural and mineral resources.

There was no specific industrial policy in the country then. India largely severed

the natural resource requirement of the British Government and British companies. On

the policy of FDI in India, there was little barrier to foreign investments in India during

this period as was the case in the rest of the world. The global environment was most

deregulated as far as foreign trade and investment was concerned during the period

before the end of the First World War that is 1918 (Jones, 1996).

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The United Kingdom dominated the foreign trade and investment in India during

this time. A rough estimate shows that about 14% of British investments came to India

and other Asian countries during 1865-1914 (Bagchi, 1972). India ranked eighth as a host

to foreign investments in 1914 (Wilkins, 1994). There were about 204 British Managing

Agents and a few manufacturing companies from U.K, Switzerland, Netherlands,

Germany, USA, and Japan engaged in trading and manufacturing activities during this

period.

The Managing agents were very large and they had business interest in large

number of businesses. Many of these Managing Agents held as many as 15-20 different

types of companies engaged in tea, jute, sugar and coal. Besides their interests in tea, jute,

and coal, the Managing Agents had interests in many other businesses like timber, paper,

insurance, shipping, indigo, and sugar (Bagchi, 1972). Japanese trading firms had also

made some investments in India during this period. Please refer to Table A1 in Appendix

for the list of British Managing Agents in India during this period. Mitsui Bussan had set-

up a trading office in Bombay in 1892 and subsequently many Japanese companies

started trading on raw cotton and yarn with India in the late nineteenth and early

twentieth centuries3.

There were about 11 manufacturing companies from UK, Europe, USA and

Japan that traded their products in India. Many of the British manufacturing companies

like Unilever, ITC, Glaxo, ICI, GEC, Goodlass Nerolac, and Britania Biscuits traded their

goods in India by importing form their parent companies. American companies like

Chicago Pneumatics and Ludlow Jute, the Dutch company, Margarine Unie and the

Japanese company, Denso operated in India during this period. Please refer to Table A2,

3 Tetsuya Kuwahara (Seminar discussions, 2000) and Manuscript of Mitsui Bussan Kaisha 100 years, volume 1, 1978 (unpublished) provide details about the historical roots of Japanese business in India in the late nineteenth and early twentieth centuries. Mitsui Bussan sent Mr. Yasukawa to India in December 1892, and soon after it set up a purchase office in Bombay in February 1893. Similarly, Nihon Menka set up its office in India in 1893. Gosho was another large trading house that set up its office in India. Besides, these three major trading houses, many smaller trading houses like Itochu, Marubeni, and many others started trading on raw cotton and yarn with India.

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Table A3 and Table A4 in Appendix for a sample list of foreign companies from

different countries that came to India during this period.

In summary, there were virtually no restrictions on FDI during this period.

However, until the end of First World War, 1918, the foreign investment in India was

totally dominated by the British companies. India was also being ruled by Britain during

this period. Trading and Services sectors were the major areas of foreign investments in

India during this period.

FDI in India, 1919-1942

United Kingdom appeared vulnerable by the end of the World War I in 1918 and

a new phase in the history of FDI in India came about beginning 1919. The United States

of America and Japan emerged as powerful nations after the World War-I (E.H Carr,

1994). Under the pressure of Indians to share power, the British Government enacted the

Government of India Act 19194, whereby Indians had greater say in the governance of

India. With the weakening of U.K. and the emergence of alternate world powers, the

freedom movement in India got further support from the world community. These

political developments had some amount of bearing on the pattern of foreign investments

in India from 1919 onwards. Following the Government of India Act, 1919 that allowed

Indian legislator to share power with British officials, Rowlatt Act5 came into force in

4 The means of achieving the proposed measure were later enshrined in the Government of India Act of 1919, which introduced the principle of a dual mode of administration, or dyarchy, in which both elected Indian legislators and appointed British officials shared power. The act also expanded the central and provincial legislatures and widened the franchise considerably. Dyarchy set in motion certain real changes at the provincial level. A number of non controversial or "transferred" portfolios such as agriculture, local government, health, education, and public works were handed over to Indians, while more sensitive matters such as finance, taxation, and maintaining law and order were retained by the provincial British administrators (Sarkar, 1983, and Chandra, 1989) 5 Rowlatt Act, 1919 made war time restrictions on civil rights permanent through a system of special courts and detention without trial for a maximum of two years. Through this Act anyone in India could be arrested on a simple pretext (Sarkar, 1983, and Chandra, 1989).

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India. M.K. Gandhi6, for the first time applied his non-violent movement on a national

scale in India to resists this legislation of the British Government. There were many small

and large mass scale uprising and resistance to British rule in India during this period.

The local manufacturing companies were also on the rise. The number of registered

manufacturing companies grew from 111 in the year 1923 to 365 by the year 1940

(Department of Commercial Intelligence & Statistics, India, Report on Joint Stock

Companies, 1929, 1931, 1939, 1941, and 1951).

Trade and investment from the USA increased in India during this period.

Among the American companies, the most notable ones that started their operation in

India during this period are General Motors, Ford Motors, and Colgate Palmolive.

General Motors started assembling passenger cars in Bombay in 1928. Soon after that

Ford Motors also started its assembling unit in Madras in 1930 and then a year later, in

1931 it started assembly units in Bombay and Calcutta. Colgate-Palmolive started its

toothpaste business in India in the year 1937.

Trade investments from Japan also increased manifold during this period. By

1928, Japan emerged as one of the largest cotton tradeing partner of India. Since the

Japanese products were better in quality and competitive in price7, the Japanese textile

companies outperformed the British textile companies in India. Japan exported more

than half (57 %) of its cotton yarn and 28% of its piece goods to India in 1932. It also

imported as much as 47% of its raw cotton requirement from India in 1928, the volume 6 Mohandas Karamchand Gandhi, who spearheaded the freedom movement in India, was a barrister by profession. He returned to India from South Africa in the year 1914 and started the Satyagraha Movement, a non-violent resistance to British rule in India. He first tried this form of resistance to different types of rent seeking of British Government in Champaran, Kheda and Ahmedabad in Gujurat. His first nation-wide resistance to British Policy was in 1919 against the Rowlatt Act. Later in 1930, he called upon the general public on a large scale to participate in a march to Dandi in India to break the salt law of the British Government. As per the rules of the British Government, Indians were not allowed to make salt with out the permission of the British Government. He undertook many such movements to free India from the British Rule. Quit India Movement in 1942 was another of his mass scale movements that culminated in India becoming an independent state (Sarkar, 1983, and Chandra, 1989). 7 Tetsuya Kuwahara (2000) discusses in detail in the Case Study of Kanegafuchi Cotton Spinning Company and the role Sanji Muto played in building high productivity and efficiency of Japanese textile spinning companies. Kuwahara mentions how the improvement in quality and productivity of Kanegafuchi Cotton Spinning Company had a great influence in the overall development of international competitiveness of Japanese textile and textile related companies in the early 1900s.

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increased to more than half (51%) in 1937. Please refer to Table A5 and Table A6 in

Appendix for details of the volumes of trade in different items during this period.

Nonetheless, British business interests remained as strong as ever. India was still

a hot spot for investments by British companies during this period. Between 1930 and

1945, as many as 28 new manufacturing British subsidiaries started their operations in

India, Tomlinson (1975). With the continued interest of British investments and the

additional interest of American, Japanese and other European countries, the total inward

stock of foreign direct investment was about 1.0 billion USD by 1929. India ranked third

among the favorable hosts to foreign direct investments in 1929, Wilkins (1994).

Further, under local and international pressures, the British Government in India,

passed the Government of India Act, 19358. This Act allowed the Indian legislators to

voice their concern and to lobby on behalf of Indian businesses. The local businessmen

and politicians strongly pushed the British Government in India to introduce import

duties9 on goods imported to India in order to protect the local industries. This seems to

have activated the foreign companies to make direct investments in manufacturing their

products in India. As many as 30 foreign companies registered in India during this period

as compared to only 7 during the previous period, 1901-1918 (Centre for Monitoring

Indian Economy, September 2003).

Many of the British and Dutch companies that were engaged in trading activities

started to invest in local manufacturing in the 1930s. For example, Unilever invested

heavily in local manufacturing of bathing soaps, washing soaps, and cooking oil/fat.

Hindustan Vanaspati Manufacturing Company started manufacturing vanaspati (a

8 The Congress Party and Muslim Parties were allowed to contest provincial elections and more people could participate in the electoral process. British Government retained the central powers. However, the sharing of power at the provincial level by both appointed officials of British Government and Indian legislators as per Government of India Act 1919 was done away with. The Indian legislators fully represented their respective provinces. 9 D.K. Fieldhouse (1972) has discussed the local government introduction of high import duties on foreign goods during the 1930s. The British Government in India was highly pressurized by the Indian parliamentarians to provide protection to the local entrepreneurs during this period B.R. Tomlinson (1989) and A.K Bagchi (1972) also highlight the issue of duties on imported goods to India.

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hydrogenated cooking oil) in 1932 at Sewri, Bombay. Later, Lever Brothers India started

soap manufacturing at Sewri, Bombay in 1934. Metal Box started to manufacture tin

containers in 1934. ICI commenced its manufacturing activities in 1939 by setting up

Alkali and Chemical Corporation of India Limited in Rishra, West Bengal. In 1935, J & P

Coats (Hunter, 1969) began to invest in local manufacturing under the name Acme

Thread Company Limited. And, Dunlop started its tire manufacturing in the year 1936. In

fact, the FDI in the Indian manufacturing industries started in the true sense during this

period. Please refer to Table A2, Table A3 and Table A4 in Appendix for a sample list

of foreign companies from different countries that came to India during this period.

By 1942, the non-violent movement started by M K Gandhi had snowballed to

become an unstoppable Freedom Movement. In 1942, the Indian National Congress

(INC)10 started the Quit India Movement11 that greatly disrupted foreign businesses in

India and British business in particular. The increasing conflict within India and the

competition among British textile industry, Indian textile industry and Japanese textile

industry halted the huge textile trade transaction that Japan had with India in the year

1942. Please refer to Table A5 and Table A6 in Appendix for data on trade of cotton and

cotton yarn between Japan and India.

In short, during 1919-42, while U.K. became vulnerable, USA and Japan

emerged as powerful nations. The American and the Japanese companies entered the

Indian market in a big way. Japan’s trade with India not only reached an all time high but

10 A O Hume formed the Indian National Congress in the year 1885. This forum was to bring together the Indian leaders with a purpose to discuss, debate and present the concerns of the people of India to the British Government in India. Over the years, this forum became the major instrument to fight for freedom of India. Most of the Indian leaders like G K Gokhale, B G Tilak, M K Gandhi, J L Nehru, Vallabhbhai Patel and most of the Indian leaders prior to 1947 were part of INC. 11 Between 1940 and 1942, the INC launched two abortive agitations against the British, and 60,000 Congress members were arrested, including Gandhi and Nehru. 1942 begins the Quit India movement, a demand for immediate and complete independence at any cost along with a commitment to non-cooperation and boycott of all things British. Gandhi said ‘this orderly disciplined anarchy should go, and if as a result there is complete lawlessness I would risk it.’ Many INC leaders were arrested for this view. By the end of Second World War, Britain was unable to spend the needed money on maintaining India and so in 1944, it began a plan to transfer power to the Indians.

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it also touched rock bottom due to the various interest groups like the British Companies,

British Government and the Indian Companies. As far as the textile business was

concerned, there was a triangular competition of Lancashire Textile Mills, Shanghai

Textile Mills and Bombay Textile Mills. The representation of Indians increased in the

governance of the British Government in India. The local businesses pressed for

protection of local industries due to the business competition within and outside India

leading to the introduction of import duties on foreign goods for the first time in India.

This set in a new shift in the composition of foreign investment in India as many foreign

companies directly invested in the manufacturing activities in India. Indeed, this period

marked the beginning of FDI in India.

FDI in India, 1943-1961

The year 1943 marked the beginning of a new period in the history of FDI in

India. Direct Investment by foreign companies, activated in the 1930s was enhanced and

encouraged by both the Indian business houses and by the newly formed Government of

India (GOI) during this period. Local industries had felt the need for foreign technology

and foreign capital by 1942. They largely favored the flow of foreign technology and

foreign capital from around the world. Although, the British Government formally

transferred power to the Indians on August 15, 1947, the policies on FDI were largely

dictated by the local business houses and politicians from the around the beginning of this

period. Within five years that is from 1943 to 1945, 14 foreign companies registered

themselves in India and this trend continued in the subsequent years until 1961. As many

as 27 foreign companies were registered in India from 1948 to 1961. Please refer to

Table A7 in Appendix for the number of foreign companies that were registered in India

during this period.

After India became politically independent in 1947, the GOI was faced with

myriad of problems. Economic and industrial development of India was one of the major

tasks at hand. First of all, the GOI nationalized many companies in some industries that

the Government considered strategic for the country. Companies in the industries like

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Power, Oil & Petroleum, Mining, Banking, Insurance, Airlines, etc, were brought under

the control of the Government. Then it adopted the Five-Year Plan12 method to improve

the economic and industrial condition of the country. Further, to strengthen the public

sector companies, the GOI under the leadership of Nehru13 sought the financial and

technical support of Russia, Germany and the United Kingdom to set up large-scale

industrial projects in India. GOI followed a dual policy of state involvement and private

involvement in the business activities in the country. GOI promoted public sector

companies in areas like steel, oil, power, defense, telecommunications and the private

sector investments were encouraged in areas like chemicals, light industries, personal

care and consumer goods.

Having experienced the level of competition in the global markets, the Indian

textile and textile related businesses had been looking for foreign technology and foreign

capital by the end of 1930s (Bagchi, 1972). Further, with the entry of more foreign

companies during the 1930s and 1940s, the competition with in the domestic market also

peaked up and the pressure to upgrade technology increased among the Indian

companies. The GOI had also understood the need for getting both foreign technology

and foreign capital for its industrial growth. It also needed foreign exchange to meet the

burgeoning imports of essential commodities. In addition, GOI faced severe foreign

exchange problem in 1957-58 and hence encouraged foreign investment in the late 1950s

to attract larger foreign exchange. All these factors compelled the Government to invite

foreign capital and technology to India during this period. This is reflected by the liberal

policies on foreign investments in the First Five-Year Plan (1951-1955) and the Second

Five-Year Plan (1956-1961).

To enhance its developmental activities, the GOI also informally started asking

the large foreign and domestic companies in India to take up some of the development 12 The GOI constituted Planning Commission in the year 1950. For every five year in advance, this commission were to plan in advance on the nature and emphasis of investment in different sectors so that India could grow steadily on all fronts. The First Five Year Plan was for the period 1951-1955. 13 Jawahar Lal Nehru was the first Prime Minister of free India. He took charge of the country when the British Government transferred power to India in 1947 and was elected first Prime Minister of the country in 1950.

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work of the Government by investing in industries that it could not undertake. Foreign

companies like Glaxo, Unilever, ICI, General Motors, Ford Motors, Pepsi Drinks, etc

were informally asked to invest in new ventures and at the same time to include local

equity in their businesses in India (Fieldhouse, 1978, Davenport, 1992). While some

foreign companies undertook the developmental role in India, many others quit India

during this period. For instance, General Motors and Ford Motors that enjoyed

monopolistic position in India for more than 20 years closed their operations in 1953.

Similarly, unwilling to abide by the government regulation to include local participation

in its equity, Pepsi Drinks ceased its operation in India in 1961 shortly after starting its

operation in 1956.

It is generally believed that the policies of GOI to nationalize companies in

certain industries and the informal pressures of GOI on foreign companies to increase

local equity participation in India reduced the flow of FDI into India during this period.

Contrary to this popular perception, this study finds that FDI to India during this period

actually rose and reached a peak in the year 1961. From 1948 to 1961, the amount of FDI

stock grew from 2558 million INR (Indian Rupee) to 5285 million INR, an increase of

nearly 143 %. Similarly, the number of foreign collaborations with Indian companies

grew significantly. The number of joint ventures increased from 34 in 1951 to 464 in

1961, an increase of nearly 14 times in a period of 11 years.

A large number of American companies invested in India during this period.

Over one hundred American companies entered India during the last three years, viz.

1956-61, of this period (U.S. Department of commerce, 1961). Please refer to Table A8

to Table A10 in Appendix for the list of American companies that started business in

India during these three years. The share of the American companies remarkably

increased from 4.4 % in 1948 to over 13% in 1961. German and Swiss companies

increased their investment amount modestly. Japan hardly had any investment in India

from 1942 to the middle of fifties. The GOI was able to direct FDI from trading and

services sectors to the manufacturing sector. Investments in trade and plantation

gradually reduced to less than half (37%) by 1948 and then it reduced to less than a

quarter (23%) by 1961 and it was a mere 5% by 1961. While the share of foreign

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investments in trade fell, the investment in the manufacturing sector increased to over

60% by the end of this period.

It is interesting to observe that the British investments grew during this period

due to the deeper commitment of British companies in India prior to 1947. In addition,

companies like Cadbury Chocolates, Tube Investments, Reckitt & Coleman, and Horlicks

from the U.K. ventured into India during this period. Further, American companies like

Pfizer, Parke Davis, Otis Elevator, Coke, Pepsi, Vicks Products, etc entered India. While

Nestle, Siemens, Pharmacia, Hoechst, BASF, etc came from Europe. Please refer to

Table A2, Table A3 and Table A4.in Appendix for a sample list of foreign companies

from different countries that came to India during this period. Although, the Japanese

trading firms had stopped their trading of cotton and cotton yarn by 1942, a few Japanese

manufacturing companies like Asahi Glass, Shimada Glass, Nippon Chemicals, Hitachi,

and Nichimen came to India in this period.

In short, the amount of FDI and the number of foreign joint ventures in India

increased significantly during this period. With India becoming free from the British rule

in 1947, the opportunity for companies from Europe and America arose. While some of

the British manufacturing companies increased their investments in India during this

period, companies from other countries especially from USA entered India in large

numbers. There was also a qualitative change in the nature of FDI in India. Share of FDI

in manufacturing sector also increased significantly during this period, due to the FDI

policy guidelines of the Government of India.

FDI in India, 1962-1977

The year 1962 is the beginning of another important phase in the history of FDI

in India. This year marks a shift in the trends of FDI in India. In the previous period, the

Government of India had begun to informally suggest the foreign companies to include

Indian equity in their companies. However, during this period, these issues were

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formalized through the legislation of Foreign Exchange Regulation Act (FERA)14 in

1973. Foreign companies also came under the Monopolies and Restrictive Policy

(MRTP)15, 1969 Act during this period. MRTP (1969) Act restricted companies on the

size of operation and the pricing of products and services.

The Reserve Bank of India geared itself to implement the above act. As a result,

many companies that did not want to increase equity participation of Indians as per

section (2) of FERA, 1973 decided to cease their operations in India. As many as 54

companies applied to wind up their operations by 1977-78 since the implementation of

the above Act in 1974 and 9 companies applied to wind up their operations in 1980-81

(Annual Reports, Reserve Bank of India16, 1977, 1978, 1981).

The closure of some well performing foreign companies like Coca Cola in 1977

and IBM in 1978 are some of the well-known cases of this period. In the 1960s, when the

Government advised the foreign companies to include local participation in their existing

equity, many foreign companies reacted adversely to such suggestions of the

Government. Unwilling to abide by the government regulation to include local

participation in its equity, Pepsi Drinks ceased its operation in India in 1961-62 shortly

after starting its operation in 1956. When the Government informally suggested

companies to invest in businesses like oil mills, fertilizers, and chemicals, industries in

which the Government could not invest, many companies objected to the policy of the

Government. However, some companies like Unilever invested in oil mills and ICI

invested in fertilizer. ICI emerged as the biggest manufacturer of fertilizer by 1969.

14 According to FERA (1973), all foreign companies that owned more than 40% equity in their Indian operations were required to get the permission of Reserve Bank of India to continue their business in India. As per section (2) of FERA, 1973, foreign firms were required to include local participation in the equity of foreign companies in India. Depending on the nature of business, some companies were allowed to own 51% of equity and others were allowed to own 74% of equity (Roy, 1973) 15 MRTP (1969) was introduced to ensure that the operation of economic systems does not create the concentration of power in hands of a few people and minimizes the trade and monopolistic practices of private companies in India. Through this Act, both the domestic and foreign private companies came under the strict vigilance especially on the size of operations and pricing of products. 16 Reserve Bank of India is the Central Bank of India. In other words, this is the Federal Bank of India.

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The amount of FDI and the number of foreign joint ventures from all the foreign

countries declined drastically from 1962 to 1968 and had an erratic trend from 1969 till

1977. The number of foreign collaborations reduced from 464 in the year 1961 to 131 in

the year 1968. Although, the number of new collaborations drastically reduced and many

of the foreign companies disinvested from India during this period, some of the existing

large foreign companies continued their operations in India. In fact, some of the

companies consolidated their market positions in India during this period. For instance,

Unilever invested in Modern Foods, Indexport Ltd., and Hind Lever Chemicals. ICI set

up Chemical and Fibers of India Limited in Thane in 1963 to manufacture polyester

staple fibers. It started manufacturing fertilizer in Panki near Kanpur in 1969 and set up

the ICI Research and Technology Center in Thane in 1976. Some of these companies also

invested in export activities as GOI provided incentives for exports by setting up two

Export Processing Zones (EPZs), viz., Kandla in 1965 and Santa Cruz in 1972.

Besides the increasing participation of the existing large foreign companies,

quite a few well-known British, American, Japanese and some European companies also

invested in India during this period. British companies like BPL, and American

companies like Cummins, Frick Company, E Merck, Precision Gears, and Singer

Machine entered India. While Continental AG, Heinrich Schmidt AG, Piaggio, Wartsila

Oy were a few European companies, Kokoku Wires, Mitsubishi, Yuken, Sankyo, and

Daikin were a few Japanese companies that invested in India during this period.

In short, this period clearly marks a shift in the FDI Policy of the Government

of India. FERA, 1973 was the culmination of the manifestation of objectives of the

Government that was pursued informally in the previous period. As a result of the

changes in the policy, nearly 80 foreign companies ceased their operations in India and

the number of joint ventures from all the foreign countries decreased dramatically.

Interestingly, while many foreign companies left India, many new companies from USA,

Europe and Japan ventured into India during this period. Further, some of the major

17

British companies that already had direct investments in India consolidated their

businesses with further investments in India during this period.

FDI in India, 1978-1990

The year 1978 marked another new phase in the liberalization and globalization

process of FDI in India. The Industrial Policy Statement, 1977 of GOI announced the

relaxation in remittances of profits, royalties, dividends and repatriation of capital of

foreign companies. Further, the Industrial Policy, 1980 of GOI set the tone of

liberalization in India in a slow but steady pace. Industrial Licensing was streamlined and

made easier. Provisions in MRTP Act (1969) were modified to simplify business

transactions. Export and Import norms were also changed to encourage FDI in India.

Prior to 1978 most of the items that were imported to India were routed through

State Trading Corporation, a government controlled organization. Only a few items that

were inconsequential to the total outflow or inflow of foreign exchange were kept in the

list of Open General License (OGL). Beginning 1978, GOI transferred most of the items

that were earlier imported through State Trading Corporation to Open General License

(OGL), wherein these imports and exports could be routed through private firms. Nearly

350 importable items were liberalized in two years (1984–1985) and many more were

subsequently added to the list of OGL.

The government also reduced import restrictions and tariffs. Since 1980, the

tariffs in general have come down to nearly 25% and in some cases up to 5% - 10%.

Further, to boost the exports from India, GOI provided special facilities and tax privileges

to foreign companies to set up 100% export oriented units. GOI set up four more export

processing zones (EPZ) in addition to the two that were already set up in the previous

period. All these policy changes led to greater liberalization on the exports and imports of

India.

The total number of joint ventures increased steadily from 1978-79 until 1984-85,

18

then decreased and showed signs of recovery during 1989-90. USA emerged to be the

biggest contributor to the number of joint ventures in India during this period. Germany

was the second largest contributor. The share of British companies in the total number of

joint ventures clearly declined in this period as compared to their overwhelming

dominance in the previous years. The share of other countries including those from

Europe increased gradually.

The amount of FDI to India greatly fluctuated during this period including the

amounts of FDI from the two leading countries, viz. USA and Germany. FDI from Japan

increased in 1982-83. However, share of FDI from the Japanese companies declined

slowly from 1982 until the end of 1990. The share of FDI from U.K. also dramatically

went down during this period. However, the liberalization process initiated in this period

has shown overall positive trends in the inward FDI as compared to the previous period.

The number of foreign companies that registered in India during this period more than

doubled to 128 from only 62 during the previous period, 1962-1977. The total number of

joint ventures also increased from 307 in 1978 to 703 in 1990. Similarly, the amount of

FDI rose from 89 million INR to 1238 million INR, an increase of over 13 times.

GOI made a series of changes in the export and import policies in India during

this period. Although, there have been fluctuations in the number of joint ventures and

the amount of FDI in India, the amount of FDI increased by nearly 13 times during this

period. In comparison to that of the previous period, the number foreign companies

registered in India doubled during this period.

FDI in India, 1991-2000

The year 1991 marks a new growth phase of FDI in India with an all time high

flow of FDI. Following the Industrial Policy (1991)17, a large number of foreign

17 The Industrial Policy (1991) made several provision to liberalize the flow of FDI into the country. With this many sectors were opened up for FDI in India. A phase wise reduction of import duties was outlined in this policy. This policy marked the beginning of many economic and fiscal reforms in India.

19

companies from different parts of the world rushed into India. In this period, in addition

to thousands of foreign collaborations in India, as many as 145 foreign companies

registered in India within a span of 10 years from 1991-2000. Companies like General

Motors, Ford Motors, and IBM that divested from India in the 1950s and 1970s reentered

India during this period. A large number of Asian companies like Daewoo Motors,

Hyundai Motors and LG Electronics from S. Korea, Matsushita Television and Honda

Motors from Japan invested in India during this period.

The Government of India faced severe foreign exchange crisis by 1990 and its

foreign exchange reserve had reached an unsustainable level. International Monetary

Fund (IMF) and World Bank agreed to provide loans to India on the conditions that India

will make major changes to liberalize trade and investments in India. The domestic

pressure to meet the imports of essential commodities and the external pressure to

liberalize Indian market forced the Government of India to accelerate the liberalization

process in India. With the legislation of the Industrial Licensing Policy, 1991, industrial

licensing was abolished except for 18 industries. FDI up to 51% equity was allowed in 34

formerly high priority industries and the concept of phased manufacturing requirement on

foreign companies was removed. Further, the tariffs on imports have been steadily

reduced in every budget since 1991.

Subsequently, GOI replaced FERA, 1973 that regulated all foreign exchange

transactions with Foreign Exchange Management Act (FEMA), 199918. The objectives of

FEMA have been to facilitate external trade and payments and to promote orderly

development and maintenance of foreign exchange market. But for sectors like banking,

civil aviation, petroleum, real estate, venture capital funds, infrastructure, service sector,

atomic energy, defense, agriculture and plantation, print media, broadcasting and postal

services, automatic approval of FDI were allowed in all other sectors during this period.

18 FEMA was created to facilitate external trade and payments and to promote orderly development and maintenance of foreign exchange market. The objective of FEMA has been to facilitate and not regulate foreign trade and investment as it was in FERA (1973), (Roy, 2000). Many of the FDI approval processes have been simplified to smoothen the approval process with the enactment of this Act.

20

The total number of foreign collaborations increased from 976 in the year 1991

to 2144 in the year 2000. Similarly, the amount of FDI increased from 5156 million INR

to 373722 million INR during this period. It is also observed that there has been a

significant shift in the share of FDI from different countries that have been investing in

India. The share of FDI from the United Kingdom reduced to almost 10% and the share

of FDI from UK & USA also decreased during this period. Interestingly the share of

other countries including S. Korea, Malaysia, Australia, and countries from Asia and

European Union increased to over 65% of the total FDI during this period.

In a period of about 40 years since the British left India, USA has gained more

control of the Indian economy through direct investments of American companies in

India. Owing to the poor balance of payment position in 1990, India had to seek loan

from the International Monetary Fund (IMF) that is largely controlled by USA. IMF used

this opportunity to force India to liberalize its economy so that foreign companies could

have more & easy access to the Indian economy and market. In the recent decade,

however, companies from many other countries have increased their share of direct

investments in India.

In summary, the poor balance of payment position of India and pressure of IMF

and World Bank to liberalize the Indian economy forced the Government of India to

accelerate the pace of liberalization process in India since 1991. While the shares of FDI

from traditionally dominant countries like the U.K. and the USA have fallen, the shares

of FDI from other countries including the countries from Asia and the European Union

have increased from 53% in 1991 to 86% in 2000. The power equation of U.K., USA,

Japan and other European countries with India had changed by the end of this period.

21

IV. Summary 1. FDI Trends in Non Manufacturing and Manufacturing, 1921-2000

Most of the investments in the first fifty years have been in trade and finance

with a focus on Plantation & Mining industries like tea, jute and coal. By 1948, the share

of FDI in trade and finance was 64%. However, by 1991-99, this had dropped to 12% and

the share of FDI in the manufacturing sector has grown to nearly 88 %. Figure 1 shows

the reversal in the trend of FDI in trade & finance versus manufacturing during 1921 to

2000. This also shows the importance of manufacturing sector in India and the steadiness

in the objectives of the Government of India since 1947. Please refer to Table A12 in

Appendix for the actual percentages of FDI in the two sectors during the period 1921 to

2000.

Figure 1: Trends in Sectorwise Share of FDI, 1921 – 2000

0102030405060708090100

1921 1938 1948 1955 1960 1991 2000

Manufacturing

Non Manufacturing

Source: Compiled from (a) Tomlinson (1989), (b) Kurian (1966), (c) Ganesh (1997), (d) India

Investment Center, Government of India, (e) Center for Industrial & Economic Research, (f)

International Investment Position of India (2003), and (g) Ministry of Finance, Government of India.

22

2. Trends in Amount of FDI, 1900s-2000

Despite the changes in the economic and political circumstances there has been a

steady rise in the average annual amount of FDI to India during the period 1921 to 2000.

Figure 2 shows the annual average inward FDI to India during 1921 to 2000. Please see

Table A13 in Appendix for the actual amount of FDI during 1921-2000. The amount

shown for the period 1991-2002, however, is the amount approved by the Government of

India and not the actual amount invested in India.

Figure 2: Annual Average FDI in India, 1921-2000 (in million INR)

Source: Compiled from (a) Tomlinson (1989), (b) Wilkins (1994), (c) India Investment Centre (1967-70), (d) Kurian (1996), and (e) Indian Investment Center (1991-2000).

The most noticeable change in the investment pattern has been the shift in the

share of amount of FDI from different countries. Until 1964-65, FDI from U.K.

constituted over 85% of the total FDI. Later during 1919 to 1941, Japan was a major

trading partner of India. During 1965 to 1990, after India was freed from British rule,

USA and Germany became the lead investors. However, in recent decade, the other

0

1

2

3

4

5

6

1921-1938 1949-1961 1962-1977 1980-1990 1991-2000

Years

Log

of Y

early

FD

I in

mill

ion

INR

23

countries19 including countries from European Union and Asia have greatly increased

their share of FDI in India. The share of other countries increased from 52% in 1991 to

86% in 2000. The trends of yearly countrywise amount of FDI to India during 1949-

2000 are shown in Figure 3. Please see Table A14 in Appendix for the yearly

countrywise actual amounts of FDI to India during 1949-2000.

Figure 3: Amount of FDI in India: 1949-2000

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

Years: 1949-2000

FDI i

n Lo

g10

Mill

ion

INR

UK USA Germany Japan Others

Source: India Investment Centre

3. Trends in Number of Foreign Companies, 1900s-2000:

Foreign companies have invested in India through out the twentieth century

either as wholly owned subsidiaries or as joint venture partners. The total number of

foreign companies newly registered in India has steadily increased during the different

time periods in the twentieth century. The number of registered companies in each period

is shown in Figure 4.

19 India Investment Center, Government of India data shows that the FDI from many Asian and South East Asian countries to India has significantly increased in the recent years. In fact, the largest investor in India in 1999 among all the foreign countries has been Mauritius. Korea, and Australia have also significantly increased their share of investments in India in the recent years.

24

Figure 4: Number of Foreign Companies Registered in India: 1901-2000

Source: Centre for Monitoring Indian Economy The number of foreign collaborations in India has also steadily increased during

the period 1951 to 2000. However, there has been significant shift in the countrywise

number of foreign collaborations in India during the same period. The countrywise trends

in the number of collaborations are shown in Figure 5. Please refer to Table A15 in

Appendix for the actual number of foreign collaborations in India during 1951 - 2000.

Figure 3.5: Trends in Countrywise Number of Foreign collaborations: 1951-2000

0

200

400

600

800

1000

1200

1400

Years: 1951-2000

Num

ber o

f Col

labo

ratio

ns

UK USA Germany Japan Others

Source: India Investment Centre

0

20

40

60

80

100

120

140

160

190 1 - 1918 1919 - 1942 1943 - 1961 1 962 - 19 77 1978 - 1990 1991 - 2000

Ye a r

Num

ber o

f for

eign

com

pani

es re

gist

ered

25

4. Periodization of FDI in India, 1900s-2000

The history of FDI in India during the twentieth century has evolved through a

six time periods, viz., 1900s-1918, 1919-1942, 1943-1961, 1962-1977, 1978-1990, and

1991-2000. During the first stage (1900s-1918), there were hardly any restrictions on the

nature and type of FDI. The foreign investments could flow ‘freely’ into India. However,

except U.K., most of the countries neither had the need and nor the will to invest in India.

Foreign Investment to India was mainly through the Managing Agents from U.K.

It was in the second phase (1919-1942) that FDI in India actually originated. The

introduction of import duties during this period ‘stimulated’ many British companies to

invest in the Indian manufacturing sector to protect their businesses in India. Although,

the Japanese companies increased their share of trade with India, U.K. remained to be the

dominant investor in India during this period.

The third phase (1943-1961) saw a huge increase in the flow of FDI into India.

During this period the Indian companies and GOI realized the need to import technology

and finance from foreign companies and encouraged the same. This led to ‘ambitious’

investments by many companies from countries like U.K. and USA.

The fourth phase (1962-1977) marked the Indian Government’s regulatory

regime that imposed severe restrictions to control foreign exchange, type of FDI and

ownership of foreign companies in India. These restrictions led to a ‘controlled’ flow of

FDI in India and nearly eighty foreign companies also divested from India during this

period.

The fifth phase (1978-1990) saw a new direction in the history of FDI in India

with liberalization in imports and exports of the country. Although, the amount of FDI

increased by over 13 times during this period, foreign companies invested ‘cautiously’

during this period with a wait and watch attitude.

26

And, in the final phase (1991-2000), the liberalization process in India was

accelerated under the behest of IMF and World Bank. There have been very high growths

in the amount of inward FDI and the number of joint ventures in India. More importantly,

FDI has flowed from across the world resulting in a globalized structure of FDI in India.

The history of FDI in India during the twentieth century may be summarized to

have evolved through a six-stage process: Free Flow (1900s-1918), Stimulated Flow

(1919-1942), Ambitious Flow (1943-1961), Controlled Flow (1962-1977), Cautious Flow

(1978-1990), and Globalized Flow (1991-2000). The history of FDI in India is

summarized in Table 1. The table summarizes the periods, the drivers of change, the

driving forces, the major sources of direct investments, the nature of investments and the

phases of evolution of present globalization of FDI in India.

V. CONCLUSION The historical analysis of FDI in India during the period 1900s-2000 shows that

today’s liberalized economy and globalized structure of FDI in India have been an

outcome of the adjustment and alignment process of the Indian Government to the

dynamics of the various domestic and international pressures and global competition

since the 1900s, and it is not merely a phenomenon of post 1991 as popularly perceived.

The rapid change and development in FDI Policies in India in the post 1991 are only the

manifestation of the change processes of the past and the enhancement of the changes

adopted in the past.

Table 1: History of FDI in India: 1900s-2004

Characteristics / Period

Drivers of Change Driving Forces Major sources of Investments

Nature of Investments

Stages of Evolution

1900s-1918

U.K.

No restriction in FDI

U.K.

Trading & Finance

Free Flow Phase

1919-1942

U.K., Japan and Local Textile companies

Import duties were introduced

U.K. and Japan

Trading, Finance & Manufacturing

Stimulated Phase

1943-1961

Government of India

Demand for foreign technology & capital in manufacturing sector

U.K. and U.S.A.

Manufacturing, Sales & Services

Ambitious Stage Phase

1962-1977

Government of India

MRTP, 1970, FERA, 1973, and Investments in public sector companies

U.S.A., Germany and U.K.

Manufacturing

Controlled Phase

1978-1990

Government of India, WTO and Local companies

Liberalization of imports and exports

U.S.A. and Germany

Manufacturing

Cautious Phase

1991-2000

IMF, World Bank, WTO and Local Business Houses.

Acceleration of liberalization and Globalization of FDI

Globalized

Manufacturing, Trade & Financial Service

Globalized Phase

REFERENCES

1. All Japan Cotton Spinners Association (1949), Cotton Statistics of Japan, 1903-1944,

Osaka, Japan

2. Athreye, S. & Kapur, S. (1999) ‘Foreign Controlled Manufacturing Firms in India –

Long-Term Trends’ Economic and Political Weekly, November 27, 1999

3. Bagchi, A.K. (1972) Private Investment in India 1900-1939, New York: Cambridge

University Press.

4. Carr, E. H. (1994) International Relations between the tow World Wars 1919-1939,

London, Macmillan.

5. Center for Industrial & Economic Research (1986) Industrial Data Book, New Delhi,

Government of India.

6. Center for Industrial & Economic Research (2000-01) Industrial Data Book: 2000-01,

New Delhi, Government of India.

7. Centre for Monitoring Indian Economy, (1989-2002), Database, Mumbai, Centre for

Monitoring Indian Economy.

8. Davenport R.P., Hines, T., and Judy S. (1992) Glaxo: A History to 1962, Cambridge

University Press.

9. Department of Commercial Intelligence & Statistics (1924, 1929, 1931, 1939, 1941,

and 1951) Report on Joint Stock Companies, 1928-29, New Delhi, Government of

India.

10. Encarnation, D. (1989) Dislodging Multinationals, India’s Strategy in Comparative

Perspective, Cornell University Press.

11. Fieldhouse, D.K. (1978) Unilever Overseas, The Anatomy of a Multinational 1895-

1965, London: The Hoover Institution Press.

12. Five Year Plans, Planning Commision, GOI, (online), (cited 30th September, 2004),

Available from

<URL: http://planningcommission.nic.in/plans/planrel/fiveyr/welcome.html>

13. Ganesh, S. (1997) ‘Who is afraid of Foreign Firms? Current Trends in FDI in India’

Economic and Political Weekly, May 31.

14. Hunter, J.B.K and Keir, D., (unpublished, 1969) Manuscript of the Coats’ History.

29

15. India Investment Center, (online), (cited March, 2000). Available from <URL:

http://www.iic.nic.in>

16. India Investment Center, (1967-1990), Foreign Business Investments in India, Monthly

Newsletter, New Delhi, India Investment Center, Government of India

17. India Investment Center, (2003), Net Flow of FDI to India, 1991-2002, (online), (cited

November 19, 2003), Available from <URL:http://www.iic.nic.in>

18. India Investment Center (1991-2000), FDI Data: 1991-2000, New Delhi, Government

of India.

19. India Investment Center, (2000) Foreign Direct Investment approved by the

Government of India, 1990-2000, New Delhi, Government of India.

20. International Investment Position of India, (online), (cited November 13, 2003),

Available from <URL:http://www.finmin.nic.in>

21. Jones, G. (1996) The Evolution of International Business: An introduction, London &

New York, Routledge.

22. Kidron, M. (1965) Foreign Investments in India, London, Oxford University Press.

23. Kurian, M. K. (1966) Impact of Foreign Capital on Indian Economy, New Delhi,

People’s Publishing House Private Limited.

24. Ministry of Finance, Government of India, (online), Sectoral distribution of FDI, (cited

November, 2003), Available from <URL:http://www.finmin.nic.in>

25. Reserve Bank of India (1976, 1977, 1978, 1981, 1985, 1991), Annual Reports,

Bombay, Government of India.

26. Reserve Bank of India, (online), (cited January, 2000). Available from <URL:

http://www.rbi.org.in

27. Reserve Bank of India, (2003) Government of India, (online), (cited November 17,

2003) Available from <URL:http://www.rbi.org.in>

28. Tomlinson B.R. (1989) ‘British Business in India, 1860-1970’ in Davenport, R.P.,

Hines, T. and Jones, G. (eds), British Business in Asia since 1860, New York,

Cambridge University Press.

29. U.S. Department of Commerce(1961), Investment in India: Basic Information for

United States Businessmen, 1961, Washington, Government of United States of

America.

30

30. Wilkins, M. (1994) ‘Comparative Hosts’, Jones, G. (eds) The Making of Global

Enterprise, London: Frank Cass and Company Limited.

31. Hines, T. and Jones, G. (1989), British Business in Asia since 1860, New York,

Cambridge University Press.

32. Industrial Data Book (1986), India Investment Centre, Government of India, New

Delhi.

33. Industrial Data Book (2000-2001), India Investment Centre, Government of India, New

Delhi.

31

APPENDICES

32

Table A1: Joint-Stock Companies Registered, 1911

Name of Managing Agents / Secretary

Number of joint-stock companies held

Tea

Coal

Jute

Total

Andrew Yule & Co. 10 11 6 27 Begg, Dunlop & Co. 10 - 2 12 Bird & Co. - 11 8 19 Shaw Wallace & Co. 2 11 - 13 Williamson, Magor & Co. 10 5 - 15 George, Henderson & Co. 2 - - 2 Planter's Stores & Agency 1 - - 1 Kilburn & Co. 6 2 - 8 Octavius Steel & Co. 10 2 - 12 Gillanders, Arbuthnot & co 1 - 1 2 Kettlewell, Bullen & Co. 1 - 1 2 J. Mackillican & Co. 2 - - 2 C.A. Stewart 4 - - 4 Duncan Bros. 12 - - 12 Davenport & Co. 8 - - 8 Hoare, Miller & Co. 1 3 - 4 Jardine, Skinner & Co. 2 2 2 6 McLeod & Co. 3 5 2 10 Barry & Co. 3 - 1 4 Macneill & Co. - 5 - 5 H.V. Low & Co. - 4 - 4 F.W. Heilgers & Co. - 7 2 9 Stanley, Oaks & Co. - 1 - 1 Apcar & Co. - - 1 1 Anderson Wright & Co. - 2 1 3 Ernsthausen Ltd. - 1 2 3 Balmer Lawrie & Co. - 4 - 4 Martin & Co. - 3 - 3 Lyall, Marshall & Co. - 1 - 1 N.C. Sircar & Sons - 7 - 7 Total 88 87 29 204

Source: Bagchi, A.K., (1972)

33

Table A2: UK Companies with Investment in India Year of

Investment Parent company Indian Company

1767 Forbes Gokak Forbes Gokak 1843 Parry & Company Parry & Company 1876 Binny & Company Binny & Company 1911 ITC ITC Limited 1911 GEC GEC (India) 1918 Associated Biscuits Britanica Biscuits 1920 Burmah Oil Co. Tinplate Co. (India) 1921 Burner Mond & Co. Burner Mond & Co.(India) 1921 Ingersoll & Rand Ltd Ingersoll & Rand (India) Ltd 1924 H.J. Foster & Co. H.J. Foster & Co. 1924 Glaxo Industries Glaxo(I) Ltd 1926 Joseph Nathan & Co Joseph Nathan & Co. 1929 ICI ICI (India) 1930 VST VST Industries 1931 GKN Guest, Keen, Williams 1931 Lever Brothers Hindustan Vanaspati Mfg. Co 1933 United Traders United Traders 1933 Lever Brothers Lever Brothers India Ltd 1933 Metal Box Metal Box (India) 1934 Turner Newall Asbestos Cement 1934 Eveready Industries Eveready Industries India Ltd 1935 BOC Indian Oxygen 1935 J & P Coats Acme Thread Company Limited 1936 Godfrey Philips Godgfrey Philips (India) 1936 Dunlop Dunlop (India) 1937 ICI Alkali & Chemicals Corporation 1947 Chloride (India) Chloride 1947 Crompton Greeves Crompton Greeves Ltd 1948 British Leyland Ashok Leyland 1948 Cadbury Cadbury India Ltd. 1948 Rallis Ltd Rallis India Ltd. 1949 TI Tube Investment (India) 1951 Reckitt & Coleman Reckitt & Coleman of India Ltd 1953 ICI Indian Explosives 1956 Unilever Hindustan Lever Ltd 1958 Horlicks Ltd Hindustan Milk Food Manufacturers 1961 ICI Chemicals & Fibres 1961 Lucas Lucas-TVS 1963 B P L(Instruments) BPL India 1974 J&P Coats Madura Coats 1984 Beecham Eskaylab 1985 SBG International BSL India(SBG India Ltd)

Source: Compiled from Bagchi (1972), Tomlinson (1989), Hines and Jones (1989), and Individual Company History

34

Table A3: European Companies with Investments in India

Source: Compiled from individual company history and individual company homepages

Year of Investment Parent company Indian Company

GERMANY 1944 Knoll, AG Knoll Pharmaceuticals Ltd (Now Abbot

Laboratories) 1956 Hoechst Marion Russel Ltd Hoechst Marion Russef Ltd 1957 BASF, AG Bayer(India) Ltd 1957 Seimens Siemens India Ltd 1971 Continental, AG Modi Rubber Ltd SWITZERLAND 1959 Nestle Nestle India Ltd 1962 Clariant ClariantO) India 1964 Secheron Ltd Emco Transformers 1974 Heinrich Schmid, AG IFB Industries Ltd (Indian Fire Blank Ltd.) SWEDEN 1923 Swedish Match AB Wimco Ltd 1937 Swedish Match AB Vulcan Trading Co. 1961 Swedish Match AB A If a Lava I 1960 Eiectrolux Whirpool of India Ltd 1964 SKF Bearing India Ltd (Associated Bearing Co.

Ltd.) 2001 Electro lux Eiectrolux Kelvinator 2001 Eiectrolux Intron Ltd ITALY 1972 Piaggio LML Ltd. FINLAND 1968 Watsila Oy Watsila NSD India Ltd HOLLAND 1930 Phiips Philips Electricals (Co.) Ltd 1979 Philips India Pvt. Ltd 1993 Philips India Pvt. Ltd POLAND 1959 Ursus Escorts Ltd.

35

Table A4: US Companies with Investment in India

Source: Compiled from individual Company History and individual Company Homepage

Year of Investment

Parent company Indian Company

1910s Ludlow Jute Company Ludlow Jute Company 1928 General Motors General Motors 1930 Ford Motors Ford Motors 1937 Colgate-Palmolive Colgate-Palmolive(India) Ltd 1950 Pfizer Dumex Pvt Ltd 1950 Coke Coke 1951 Vicks Product Inc. Vicks Product Inc. 1951 IBM IBM, India 1956 Pepsi Pepsi 1958 Park-Davis Park-Davis(India) Ltd. 1960 Kelvinator International Co. Whirpool of India Ltd 1962 Cummins Cummins India Ltd 1963 Mansfield Tire & Rubber Co. MRF Ltd 1967 E. Merck E Merck (India) Ltd 1979 Castrol Castrol India Ltd 1985 Proctor & Gamble P&G, India

(by acquiring Richardson Vicks Inc.) 1987 Timken Inc. Tata Timken 1989 Hewlett Packard Hewlwtt Packard, India 1995 Ford Motor Co. Ford, India 1995 Genera! Motors General Motors India Ltd

36

Table A5: Japan's total Raw Cotton Imports vis-à-vis Imports from India

Source: All Japan Cotton Spinners Association, (1949)

World India

Year Quantity Value Unit Price Quantity Value Unit Price

% from India

1928 1,302,023 549,942 0.42 613,857 232,267 0.38 47

1929 1,438,610 573,016 0.4 634,863 231,108 0.36 44

1930 1,276,421 362,047 0.28 630,059 147,038 0.23 49

1931 1,487,577 296,273 0.2 641,100 113,262 0.18 43

1932 1,698,688 447,401 0.26 365,312 91,747 0.25 22

1933 1,665,277 604,847 0.36 530,304 163,797 0.31 32

1934 1,807,314 731,423 0.4 772,318 252,435 0.33 43

1935 1,637,832 714,262 0.44 694,805 259,037 0.37 42

1936 2,028,156 850,451 0.42 836,926 315,061 0.38 41

1937 1,835,322 851,163 0.46 935,498 363,635 0.39 51

1938 1,259,461 436,835 0.35 412,811 113,331 0.27 33

1939 1,335,127 462,007 0.35 448,320 120,997 0.27 34

1940 1,026,248 504,072 0.49 312,358 115,374 0.37 30

1941 785,892 391,783 0.5 283,937 94,064 0.33 36

1942 269,375 224,306 0.83 2,910 1,574 0.54 1

37

Table A6: Japan's total Exports of Cotton Yarn vis-à-vis Exports to India

World India

Year Quantity Value Unit Price Quantity Value Unit Price

% From India

1918 168,605,067 162,789,759 0.97 31,770,667 34,998,715 1.1 19

1919 92,134,800 121,636,927 1.32 1,901,200 2,930,475 1.54 2

1920 121,970,000 154,981,805 1.27 19,016,133 30,252,515 1.59 16

1921 116,904,400 80,563,002 0.69 14,865,600 11,991,354 0.81 13

1922 157,624,800 114,723,255 0.73 27,327,867 20,666,783 0.76 17

1923 99,329,867 78,511,961 0.79 23,574,934 20,511,834 0.87 24

1924 108,144,267 109,610,952 1.01 32,336,133 35,954,637 1.11 30

1925 124,321,067 123,116,965 0.99 34,863,667 33,716,812 0.97 28

1926 82,220,400 70,716,335 0.86 23,913,333 23,086,163 0.97 29

1927 47,062,400 38,794,408 0.82 21,895,200 20,010,131 0.91 47

1928 28,662,400 25,894,905 0.9 6,991,099 9,131,071 1.31 24

1929 26,960,667 26,755,702 0.99 11,055,600 13,443,308 1.22 41

1930 23,846,400 15,032,819 0.63 8,015,733 6,576,936 0.82 34

1931 12,690,267 8,510,607 0.67 6,479,467 5,592,234 0.86 51

1932 35,842,133 21,546,681 0.6 20,313,133 14,343,000 0.71 57

1933 19,322,133 15,712,038 0.81 7,372,800 7,605,372 1.03 38

1934 25,937,733 23,484,585 0.91 9,727,333 11,111,917 1.14 38

1935 38,633,200 35,873,277 0.93 17,953,133 20,093,092 1.12 46

1936 44,209,733 38,344,845 0.87 16,870,400 18,050,783 1.07 38

1937 51,892,267 54,905,696 1.06 14,754,233 19,845,595 1.35 28

1938 42,106,000 39,355,054 0.93 18,823,899 29,591,750 1.57 45

1939 82,838,339 71,089,521 0.86 23,430,957 23,953,631 1.02 28

1940 60,950,331 57,975,942 0.95 12,795,151 16,017,440 1.25 21

1941 45,100,000 52,973,763 1.17 5,493,100 9,590,522 1.75 12

1942 2,943,560 5,789,137 1.97 - - - -

Source: All Japan Cotton Spinners Association (1949)

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Table A7: Number of Foreign Companies registered in India, 1901 – 2000

Source: Centre for Monitoring Indian Economy (1989-2002)

Period

Number of Foreign companies registered in India

1901 - 1918 7

1919 - 1942

30

1943 - 1961

72

1962 - 1977

62

1978 - 1990

128

1991 - 2000

145

39

Table A8: US Companies with Investments in India, 1961

Source: U.S. Department of Commerce, 1961

United States Firms Indian Subsidiary of Affiliate Abbot Universal Ltd. Abbot Laboratories(India) Pvt. Ltd American Cynamid Company Lederle Laboratories (India) Pvt. Ltd. American Home Products Corp. John Wyeth & Brothers, Ltd., Steelcrete House Wyeth (India) Pvt. Ltd., Steelcrete House Californai Texas Oil Company Caltex Oil Refining (India), Limited Caltex Corporation Caltex (India), Limited The Carborabdum Company Carborandum Universal Ltd Colgate-Palmolive Company Colgate-Palmolive (India) Ltd Corn Products Refining Company Corn Product Company (India) Pvt. Ltd Dayton Rubber Company Premier Tyres, Ltd Dorr-Oliver, Inc. Dorr-Oliver (India) Ltd. Dow Chemical Company Polychem, Ltd The Firestone Tire and Rubber Co. The Firestone Tire & Rubber Co. of India Pvt Ltd Synthetics & Chemicals Ltd Good Year Tire & Rubber Co. Good Year Tire & Rubber Co. of India Pvt Ltd Johnson & Johnson Inc- Johnson & Johnson (Great Britain) Ltd. Kaiser Aluminium & Chemical Corp Hindustan Aluminium Corp. Ltd Kaiser Engineering Overseas Corp Mysore Cements, Ltd Mr. F. S. Kerr F. S. Kerr & Co. Pvt Ltd Cochin Company Ludlow Jute Company Ludlow Jute Company Ltd Par, Davis & Company Ltd Par, Davis & Company Ltd Parsons & Whittemore South Asia Co, Inc. Mandya National Paper Mills Ltd Seshasayee Paper & Boards Ltd Philips Petroleum Company Phillips Carbon Black, Ltd Radio Corporation of America Photophones Equipment Pvt Ltd Remington Rand Division Remington Rand of India Ltd Standard Vacuum Oil Company Standard Vacuum Oil Company Steel Improvement Forge Co. Republic Forge Co. Ltd Union Carbide Corporation Union Carbide (India) Ltd Von Kohorn International Corp. India Rayon Corporation Ltd Westrex Corporation Westrex Company (India) American Express Company, Inc. American Express Company, Inc. AmerinTrading Companies Malabar Fisheries Corporation Geophysical Service Inc. Geophysical Service International, S.A- IBM World Trade Corporation IBM World Trade Corporation Otis Elevator Company Otis Elevator Company India Pvt Ltd Willey's Overland Export Corporation Mahindra & Mahindra Ltd

40

Table A9: US Companies with Licensing or other Agreements with Indian Firms, 1961

Source: U.S. Department of Commerce, 1961

United States Firm Indian Firm American Chemical Paint Company Imperial Chemical Industries (India) Ltd Bahnson Company C- Doctor and Company Pvt. Ltd Bancroft, Jos., and Sons Company Standard Mills Company Ltd Bogen, David, Company Inc Electronic Limited Buell Engineering Company Inc Associated Cement Companies Ltd Burgess Battery Company Estrela Batteries Ltd Bush Manufacturing Company American Refrigerator Company Byron Jackson Pumps Inc Greeves Cooton & Company Ltd Carrier Corporation Voltas Ltd Chrysler Corporation Premier Automobiles Ltd dark Electronic Laboratories Automatic Electric Devices Co. Ltd Cluett-Peabody & Co. Inc Serampur Cotton Mills Ltd Kohinoor Mills Ltd New Sharrock Spinning & Mfg. Company Ltd New Commercial Mills Company Standard Mills Ltd Vijay Mills Company Ltd Elgin Mills Company Ltd Vikram Mills Ltd Rustom Jehangir Vakil Mills Company Ltd Bombay Dyeing & Mgf Co. Ltd Gaekwar Mills Ltd Shriram Ambica Mills Ltd Buckingham & Garnatic Spinning & Weaving Mills Ltd Colgate-Pa I motive Company Colgate-Palmolive (India) Pvt Ltd Combustion Engineering Inc. Textile Machinery Corporation Ltd Davis & Lawrence Company Geoffrey Manners & Company Pvt. Ltd Ebasco Services Inc. Tata Hydro-Electric Company Ltd The English Mica Company Governor of Rajasthan Firestone Tire & Rubber Co. Automobile Products of India Ltd Gould-National Batteries Inc. Amco Batteries Ltd Hackett Brass Foundry Tata Iron & Steel Company Ltd Kinney, S.P. Engineers Inc. Tata Iron & Steel Company Ltd Koppers Company Inc. Tata Iron & Steel Company Ltd Kullian Corporation Damodar Valley Corporation Nielson Chemical Company Addition Paints & Chemicals-Pvt Ltd Rayon Consultants Inc. National Rayon Corporation Ltd Sawyer's Inc. Patel (India) Ltd Skonandoa Rayon Corporation National Rayon Corporation Ltd Snell, Foster D. Inc. Swastic Oil Mill Ltd Squibb, E.R. and Sons Sarabhai Chemicals Ltd Studebaker Packard Corporation Hindustan Motors Ltd United States Air Conditioning Corp Electronics Limited United States Vitamin Corp American Products Company Ltd Wayne Pump Company Mercantile & Industrial Development Company Ltd Willys Motors Ltd Mahindra & Mahlndra Ltd Zonite Products Ltd Geoffrey Manners & Company Pvt. Ltd

41

Table A10: US Companies with Investments in India, 1961 (Primarily in Office Equipment. Stores. Stocks, and Spare Parts)

United States Firms Indian Subsidiaries or Affiliates American Bureau of Shipping American Bureau of Shipping American Export Lines Inc. American Export Lines Inc. American Foreign Insurance Association American Foreign Insurance Association American International Underwriters Corp. American International Underwriters (India) Pvt. Ltd Armco International Corp. Armco (India) Pvt. Ltd Associated Press Associated Press of America Chase Manhattan Bank Chase Manhattan Bank Chesebrough-Pond's Inc. Chesebrough-Pond's Inc. Coca-Cola Export Corporation Coca-Cola Export Corporation Columbia Broadcasting System Columbia Broadcasting System Columbia Pictures Intrl. Corp. Columbia Films of India Ltd The ChicagoPneumatic Tool Company Consolidated Pneumatic Tool Company Ltd Dodge & Seymor Ltd Dodge & Seymor (India) Pvt Ltd Eli Lilly Intrernational Corp. Eli Lilly and Company of India, Inc. First National City Bank of New York First National City Bank of New York Gerdau India Corporation Gerdau India Corporation Getz Brothers & Company Getz Brothers & Company Grant Advertising Inc Grant Advertising Inc Gulf Oil Corporation Gulf Oil (India) Ltd International Business Consultants Ltd Iboon Private Ltd Indamer Company Pvt Ltd. Indamer Company Pvt Ltd Ingersoli-Rand Company Ingersoli-Rand (India) Pvt Ltd International Chemical Company Inc. International Chemical Company Ltd. International General Electric Company International General Electric Co. (India) Pvt Ltd Isthmian Lines Inc Isthmian Steamship Company Kuljian Corporation Kuljian Corporation Loew's International Corporation Metro-GoIdwyn-Mayer India Ltd Loew's International Corporation Metro Theatre Bombay Ltd McGraw-Hill International Corporation McGraw-Hill International Corporation Monsanto Chemical Company Monsanto Chemical Company Muller & Phipps (Asia) Ltd Muller & Phipps (India) Pvt. Ltd National Cash Register Company Picker International Corporation Pan American World Airways Inc Pan American World Airways Inc Paramount International Films Inc Paramount Films of India Ltd Ralph M. Parson Company Ralph M. Parson Company Pepsi-Cola Pepsi-Cola Picker X-Ray Corporation Picker International Corporation RKO Radio Pictures RKO Radio Pictures (Private) Ltd Republic Pictures International Corp Republic Pictures of India Ltd Edward T. Robertson and Sons Edward T. Robertson and Sons

42

L D Seymour & Company Inc L D Seymour & Company (India) Pvt Ltd Singer Sewing Machine Company Singer Sewing Machine Company The Stanley Works The Stanley Works J- Walter Thompson Far Eastern Co. J. Walter Thompson Company Pvt Ltd Trans World Airlines Inc Trans World Airlines Inc 20th Century-Fox Intrl. Corp. 20th Century-Fox Corp. (India) Pvt Ltd United Artists Corporation United Press Association Universal Pictures Co. Inc. (Production) Universal Pictures India Pvt Ltd Van Reekum-Gepacy Paper Inc. Van Reekum-Gepacy Paper Pvt Ltd Warner Brothers Warner Brothers, First National Pictures Inc. Westinghouse Trading (Asia) Ltd Westinghouse Trading Company (Asia) Ltd

Source: U.S. Department of Commerce, 1961

43

Table A12: Sectorwise FDI in India, during 1948--2000

Source: Compiled from (a) Tomlinson (1989), (b) Kurian (1966), (c) Ganesh (1997), (d)

India Investment Center (2003), (e) Center for Industrial & Economic Research (1986, 2000-01), (f) International Investment Position of India (2003), and (g) Ministry of Finance (2003), Government of India.

Table A13: Total Amount of FDI in India, 1921-2000

Sources: Compiled from Tomlinson (1989), Wilkins (1994), India Investment Center(1967-70. 1991-2000), Kurian (1996), Industrial Data Book (1986), Industrial Data Book (2000-01). Please Note: The amount for the period 1991-2002 is the amount approved by the Government of India and not the actual amount invested in India

Year

1921

1938

1948

1955

1960

1991

2000

Manufacturing

12

11

36

51

59

88

88

Non Manufacturing

88

89

64

41

41

12

12

Year

Amount of FDI (in Billion INR)

1921 2.03

1921 - 1938 0.32 1949 - 1961 3.55 1962 - 1968 2.20 1970 - 1979 3.53 1980 - 1990 11.5 1991 - 2000 2474

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Table A14: Countrywise Amount of FDI in India: 1949 – 2000 (In million INR)

Year

UK

USA

Germany

Japan

Others

Total

1949* 240.8 37.8 0.0 0.0 n.a 278.6 1950* 240.8 37.8 0.0 0.0 n.a 278.6 1951* 240.8 37.8 0.0 0.0 n.a 278.6 1952* 240.8 37.8 0.0 0.0 n.a 278.6 1953* 240.8 37.8 0.0 0.0 n.a 278.6 1954 252.0 49.0 12.0 0.5 n.a 313.5 1955 252.0 49.0 12.0 0.5 n.a 313.5 1956 157.0 71.0 3.0 0.0 n.a 231.0 1957 63.0 105.0 7.0 4.0 n.a 179.0 1958 0.0 25.0 3.0 0.0 n.a 28.0 1959 1.0 76.0 16.0 0.0 n.a 93.0 1960 427.0 50.0 14.0 8.0 n.a 499.0 1961 163.7 286.3 42.75 71.75 564.5 1091.3 1962 163.7 286.3 42.75 71.75 564.5 1091.3 1963 163.7 286.3 42.75 71.75 564.5 1091.3 1964 163.7 286.3 42.75 71.75 564.5 1091.3 1965 314.0 522.0 82.0 72.0 83.0 1073.0 1966 94.0 286.0 75.0 49.0 178.0 682.0 1967 956.0 1283.0 450.0 232.0 1045.0 3966.0 1968 0.0 472.0 156.0 171.0 163.0 769.0 1969 241.0 331.0 112.8 58.1 263.6 1007.1 1970 241.0 331.0 112.8 58.1 263.6 1007.1 1971 16.6 15.8 11.4 3.7 10.9 58.4 1972 10.8 40.9 1.1 0.2 9.2 62.3 1973 1.2 12.0 7.0 3.3 4.8 28.2 1974 5.2 19.4 6.0 4.7 32.0 67.1 1975 1.5 12.0 6.9 1.3 10.1 31.8 1976 5.6 44.7 9.8 0.0 12.6 72.7 1977 6.7 18.2 7.5 0.0 7.7 40.0 1978 5.0 47.3 8.6 1.3 32.0 94.1 1979 14.8 22.2 4.4 0.0 15.0 56.4 1980 9.7 21.7 4.7 17.0 35.2 88.3 1980 9.7 22.0 4.7 10.2 42.4 89.0 1981 7.1 22.5 54.2 6.5 18.7 109.0 1982 16.5 50.3 35.3 251.1 274.8 628.0 1983 98.0 138.9 48.4 160.8 172.9 619.0 1984 18.1 89.5 28.4 61.5 932.5 1130.0 1985 37.0 400.0 118.0 157.0 495.0 1207.0 1986 77.0 294.0 202.0 56.0 441.0 1070.0 1987 85.0 295.0 99.0 69.0 529.0 1077.0 1988 139.0 970.0 310.0 174.0 805.0 2398.0 1989 335.0 622.0 1203.0 88.0 919.0 3167.0 1990 91.0 345.0 195.0 50.0 602.0 1283.0

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1991 313.0 1749.0 376.0 520.0 2207.0 5165.0 1992 1177.0 11383.0 965.0 6102.0 18388.0 38015.0 1993 6227.0 34730.0 1754.0 2574.0 43333.0 88618.0 1994 12991.0 34881.0 5694.0 4009.0 84298.0 141873.0 1995 17259.0 70448.0 13395.0 15143.0 208579.0 324824.0 1996 15246.0 100549.0 15375.0 14882.0 215447.0 361499.0 1997 44907.0 135698.0 21548.0 19064.0 327687.0 548904.0 1998 32008.0 35619.0 8538.0 12828.0 218642.0 307635.0 1999 29630.0 35755.0 11430.0 15947.0 190903.0 283665.0 2000 4121.0 41398.0 5938.0 8275.0 313990.0 373722.0

Source: Center for Industrial Economic Research, (1986 & 2001), Industrial Data Book (1986), Industrial Data Book (2000-01), (1991-2000), Indian Investment Center, (1967-1990), and India Investment Center (1991-2000).

Please Note: 1. The amount for the years with * mark are average figures

2. The amounts for the period 1991 – 2002 are amounts approved by GOI and not the actual amount of invested in India.

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Table A15: Countrywise Number of Foreign Collaborations in India, 1951– 2000

Year

U.K.

U.S.A

Germany

Japan

Others

Total

1951 17 12 3 2 n.a 34 1952 19 9 1 2 n.a 31 1953 29 7 4 1 n.a 41 1954 31 14 5 0 n.a 50 1955 30 15 11 2 n.a 58 1956 39 16 7 6 n.a 68 1957 57 19 15 4 n.a 95 1958 75 29 21 6 n.a 131 1959 160 58 61 15 n.a 377 1960 161 93 73 50 n.a 464 1961 226 108 85 45 n.a 337 1962 141 103 54 29 10 337 1963 118 110 59 44 1 332 1964 143 112 80 37 5 377 1965 108 65 60 31 3 267 1966 44 42 41 18 0 145 1967 50 34 24 21 2 131 1968 19 36 22 12 0 89 1969 34 18 28 17 2 99 1970 39 33 36 15 0 123 1971 55 43 42 35 1 176 1972 38 62 49 27 1 177 1973 53 48 60 36 2 199 1974 59 79 68 28 3 237 1975 54 55 59 23 6 197 1976 54 69 58 10 1 192 1977 59 54 55 20 1 189 1978 61 58 58 28 102 307 1979 63 48 54 12 90 267 1980 110 125 100 34 157 526 1981 80 85 74 27 123 389 1982 105 109 110 51 213 588 1983 119 135 129 58 232 673 1984 123 143 132 78 264 740 1985 149 229 187 111 365 1041 1986 134 203 188 111 324 960 1987 130 217 154 82 320 903 1988 142 200 179 98 338 957 1989 78 137 114 63 247 639 1990 107 142 141 55 258 703

47

1991 140 174 167 74 421 976 1992 183 344 199 101 693 1520 1993 175 318 177 95 711 1476 1994 199 360 216 134 945 1854 1995 202 491 256 147 1241 2337 1996 205 434 256 160 1248 2303 1997 191 451 257 156 1270 2325 1998 164 390 198 143 891 1786 1999 194 488 218 158 1166 2224 2000 166 509 198 111 1160 2144

Source: Center for Industrial Economic Research (1986 & 2001), Industrial Data Book (1986), Industrial Data Book (2000-01), Indian Investment Center (1967-1990), and India Investment Center (1991-2000) Please Note: The figures for the period 1991 – 2002 are numbers approved by the Government of India and not the actual number of collaborations.