Coca Cola Finds A New Frontier In India

Coca Cola, one of the greatest symbols of globalization, could never have passed up the chance to enter the India market. Although southern Asia has always been averse to parting with its historical customs, especially of the culinary variety, Coca Cola, headquartered in Atlanta, Georgia, leaves no doubt as to its intentions. After investing a further $1.4 billion in Cina in 2011, Coca Cola is now looking to Myanmar for its next investment, following the opening of the isolated country to outsiders.
The latest announcements are about India, and the $5 billion Coca Cola plans to invest in the country over the next 8 years. Traditional economies are stagnating, and Coca Cola’s management is taking advantage of the opportunities present in the so-called emerging markets. Sales of Coca Cola products actually dropped in the US, Canadian, and German markets in the first ten years of the new millennium, while sales exploded in Russia, China, Pakistan, and India, growing by 390%, 300%, 270%, and 200%, respectively.
Coca Cola had actually abandoned India in 1977, after years of presence. The demands of the government had become difficult to fulfill and were restricting the company’s independence. Delhi in those years was being run by a mix of elephantaic bureaucracy, autocracy, and nationalism. The licensing and protectionism of the Indian system at the time was an ill fit for the enterprising attitudes of a company forged by the demands of the free market. Faced with a partnership it did not want, the multinational corporation opted to leave the market entirely.
The Indian market at the time was dominated by local products, known collectively as Indian Cola, of which Thums Up was the dominant brand, but by 1993 the business climate had changed. India began to open up to foreign money, and those investments were welcomed by a nation desperately seeking modern technology. Pepsi Cola had preempted the opening up with two joint ventures formed in 1991, and sales of Pepsi Cola grew to command 15% of the carbonated drink market, while Coca Cola took only 9%. Coca Cola’s total worldwide sales still outpace Pepsi, 56% to 40%, however.
The heated competition between the American giants is consequently beneficial to India, bringing investments and technology in return for the promises of a growing market, confirmed by the bustling gathering places of the great Indian metropolises, the students, city businessmen, and young people that are all part of an India that does not fear international contagion.

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