International business article - Assignment Example

Last June Bharti Aitel, India’s largest mobile provider, paid $9 billion to acquire the cellular operations of Kuwait Zain. One of the reasons for the acquisitions of African companies is that compared to India the valuation of these companies are much more attractive. “The Indians view Africa as a place they can where they can replicate the low-cost, high efficiency business model they have honed at home” (Srivastava & Subramaniam). Africa has a lot of people that are eager to buy consumer goods.

Consumer spending in Africa will double in the next decade to reach $1.8 trillion by the year 2020. The African people have been deprived of basic consumer goods for a long time and they are eager to increase participation in the consumer markets. Indian companies visualize Africa as a place they can continue to achieve growth due to the fact that business activity is slowing down at home. Indian companies also want to take advantage of the lower regulatory requirement available for investors in Africa.

The article mentions a lot of the advantages that the African continent represents for India businesses. It seems as if the Indian business people want to exploit the African market in order to improve their sales numbers and profitability. Africa is one of the poorest regions in the entire world particularly the Sub-Saharan African region. The article was a bit one side as far as illustrating the advantages that Africa offered to India and not letting the reader know how Africa is going to benefit from the Indian involvement in Africa.

Some of the large acquisitions mentioned in the article made a lot of sense from a business standpoint. Due to the fact that Africa has very poor infrastructure landlines are barely available. Most Africans that desire to communicate with each other must utilize mobile technology. It would be smart the African mobile company to offer prepaid mobile services since they are cheaper to acquire which increases the amount