Foreign Direct Investment and Strategic Partnerships: Cross Border Acquisitions between India and Africa

Procedia Social and Behavioural Sciences, International Relations Conference on India and Development Partnerships in Asia and Africa: Towards a New Paradigm

Posted: 2 Dec 2016

See all articles by Dipali Krishnakumar

Dipali Krishnakumar

Symbiosis International University - Symbiosis Center for Management & Human Resource Development

Madhvi Sethi

Symbiosis International University - Symbiosis Institute of Business Management, Bengaluru

N.K. Chidambaran

Fordham University - Gabelli School of Business

Date Written: 2014

Abstract

The African economy provides an investment opportunity for International players both in terms of procuring natural resources and opening up a potential one billion consumer market. Along with the vast investment potential, on the downside firms face challenges that come from investing into nations with corporate governance, infrastructure and regulatory environments that are not as conducive for investments as found in developed nations. In this paper, we study Foreign Direct Investments (FDI) in the form of cross border acquisitions made by Indian firms in Africa during the 2002 to 2010 time frame. We report on the growth of Indian investments into Africa, nature of investments during this period and short time cumulative abnormal returns (CARs). We select two large deals that were subsequently withdrawn, to understand the nature of issues that come up while Indian firms invest in Africa. The paper’s findings provide possible avenues of partnerships through investment in Africa and the challenges associated with the same.

Keywords: Foreign Direct Investment, Cumulative Abnormal Returns, India, Africa

Suggested Citation

Krishnakumar, Dipali and Sethi, Madhvi and Chidambaran, N.K., Foreign Direct Investment and Strategic Partnerships: Cross Border Acquisitions between India and Africa (2014). Procedia Social and Behavioural Sciences, International Relations Conference on India and Development Partnerships in Asia and Africa: Towards a New Paradigm, Available at SSRN: https://ssrn.com/abstract=2878737

Dipali Krishnakumar

Symbiosis International University - Symbiosis Center for Management & Human Resource Development ( email )

Pune, 411057
India

Madhvi Sethi (Contact Author)

Symbiosis International University - Symbiosis Institute of Business Management, Bengaluru ( email )

Electronic City
Phase I
Bangalore, 560100
India

N.K. Chidambaran

Fordham University - Gabelli School of Business ( email )

United States

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