Essays on Managing FDI in an Emerging Market: British Petroleum Company Case Study

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The paper "Managing FDI in an Emerging Market: British Petroleum Company " is a good example of a marketing case study.   The need to embrace global operations has brought a great impact on the activities of business organizations. Foreign Direct Investment has played a significant role in enhancing the ability of companies to penetrate international markets. The FDI framework enables a business to invest and control its activities in a foreign country after undertaking a critical analysis of vital underlying factors such as the size of the market and the global policies.

The need to reduce the cost of production and to acquire significant economic resources has led to the penetration of the foreign market among multinational companies. The adoption of the Dunning's eclectic paradigm has redefined the examination of the effectiveness of the FDI on both the local and international market. The model evaluates a company's foreign investment through the analysis of the ownership, location, and internalization. The ownership framework evaluates the resources, patents and technology. The location framework examines the market size while internalization focuses on the opportunities and competencies within the business.

This paper examines how the British Petroleum Company (BP) has managed the FDI in India. The effective management of the Foreign Direct Investment has enabled BP Incorporation to achieve sustainability and the expansion of its operations into the emerging foreign markets. Ownership According to Dunning’ s eclectic paradigm, ownership is an important aspect that can be used to evaluate the competitive advantage of a company in the global market. The analysis of control focuses on the resource-based view and the firm-specific benefits and how they can boost the operations of the firm in a foreign market.

Moreover, the ownership framework examines the tangible and intangible resources that are available within the company (Hill & Munday 1992, p. 538). The framework analyses the resources, the patents, trademarks, technology, and the capital created in the foreign market. BP has built several oils and gas manufacturing plants in several regions in India. The firm also possesses other important resources such as technological infrastructure, and skilled labor. The business is known in the world as one of the largest oil and gas producer. BP has established both offshore and onshore oil and gas manufacturing plants.

This measure has led to the production of large quantities of petroleum products for both local and international market hence increasing the number of resources. BP decided to expand its operations to India, one of the emerging markets in recent years. To expand its operations and increase the vital resources in the Indian market, BP merged with Reliance Industries Oil Company. BP managed to acquire a 30% stake in the company due to the availability of vital resources.

Through the merger, BP has managed to expand its operations in India. The company has acquired exploration and oil and gas production rights that have led to the production of large quantities of oil and gas. The firm also produces aviation fuel and natural gas that are both used locally and also exported to the global market. The use of advanced technology has played a critical impact on boosting the production of large quantities of oil in the country (Driffield & Love 2007, p. 465). Moreover, the firm uses the efficient pipeline to transport refined oil and gas to the market thus reducing the transportation cost.



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