These days a number of South Asian countries including India still remain developing. “More recently, efforts have focused on changing the cultural mindset in India regarding entrepreneurship and on creating entrepreneurs by giving youth the self-confidence to become high achievers.” (Dana 2000) A number of studies have concluded that business is able to guarantee India and other South Asian countries the proper level of development; however, there exist certain pros and cons of business getting involved in the development process in South Asia (India).
Firstly, businesses will be able to boost the economies of South Asian countries and attract new investors. “For developing countries, balanced and sustainable economic growth in the long term also depends on attracting more foreign investment to grow their economies.” (Sulaiman 2006) Any kind of business in South Asian regions is likely to attract a great number of investors who will contribute to the development of the country due to their financial abilities. An increasing number of foreign investors will also be favorable for the already existing businesses because it will diversify them. “A lot of Asian families do not succeed after a certain level in business is that they do not want to diversify.” (Stirling 2006) This is particularly true about India where numerous family businesses crash because of a lack of diversification. Foreign investors will not only assist in the development of South Asian regions but will help the existing business.
Secondly, businesses will not let corruption develop in India. Corruption is the number one problem in India. For forty-five years of existence, the citizens of the country can hardly get services from public organizations without paying bribes. The government will enforce fighting with corruption for “Obstacles, such as corruption and weak infrastructure in developing countries, and some trade and other policies of developing countries, limit the role that business chooses to play in international development.” (Edelman 2005) South Asian countries will be able to tackle the problem of weak infrastructure and corruption and develop themselves by means of spreading businesses throughout the regions.
Furthermore, businesses will make it possible to implement CSR strategies in developing countries. Though these days corporate citizenship is not alien to developing countries, some changes still need to be introduced in order to make the companies act more responsibly. When Indian companies were asked whether they report on CSR-related issues, such as social welfare, environment, workers’ rights, anti-discrimination, etc), “24 percent said they did not, 35 percent said they did, and 41 percent did not answer the question” (Brown 2001). Business demands implementation of CSR programs; thus, introducing it in such countries as India will help to cope with social problems and develop the nation simultaneously.
However, the only fact the country is still developing may hinder the expansion of business. Poor development and a number of other factors do not let the international companies implement their strategies in such countries, “HIV/AIDS, climate change, poverty, and conflict all present risks to the future expansion of business in the global South, and thus to the long-term strategies of international companies.” (Bendell 2005) The fact that the countries are undeveloped frightens the investors and they avoid having business there.
In sum, business is beneficial for the development of South Asian countries. Businesses will attract a number of investors and help South Asian countries fight corruption and weak infrastructure; they will help to fight with the social problems by implementing different CSR strategies; the only disadvantage of business in developing countries is that, in case of a failure to conduct business there, the international companies avoid investing in such countries.
References
- Bendell, J 2005, ‘In whose name? The accountability of corporate social responsibility,’ Development in Practice, vol. 15, no. 3-4, pp. 362-374.
- Brown, K 2001, ‘Corporate Social Responsibility: Perceptions of Indian business,’ Centre for Social Markets.
- Dana, LP 2000, ‘Creating Entrepreneurs in India,’ Journal of Small Business Management, vol. 38, no.1, p.86.
- Edelman, 2005, Business and International Development: Opportunities, Responsibilities and Expectations, Kennedy School of Government and International Business Leaders Forum.
- Stirling, N 2006. ‘Risk Taker with the Heart of a Lion; Monday Interview Devinder Malhotra Is a Member of His Family’s Tyneside Business Dynasty. He Has Built Up His Own Company – DAV Developments – since Arriving in Newcastle 17 Years Ago, Investing in Pubs to Care Homes. Nigel Stirling Talks about the Asian Business Community and the Future of the Malhotra Dynasty,’ The Journal, p.28.
- Sulaiman, T 2006, ‘Companies must help countries hit by Aids, Barclays warns,’ The Times