IB06

International Business

Assignment I

Assignment Code: 2010IB06B1 Last Date of Submission: 30th September 2010

Maximum Marks: 100

Attempt all the Questions. All questions are compulsory and carry equal marks.

Section A

1. Describe in detail :
(a) WTO Agreement on Anti dumping duty
(b) Agreement on Rules of Origin(ROO)
(20)
2a. Describe in detail the concept of “Horizontal Foreign Direct Investment”.
b. Give an account of inward FDI in India in the Telecom Sector.
(10+10)
3. Give details of various methods used by International Marketers for management of exchange risk.

4. Why are various businesses going in for International sources of financing? Describe key
international financial instruments being used by Indian business.
(20)
Section B

Case Study: Complaints against China with WTO- A case of protectionism

US has filed a complaint with the World Trade Organisation (WTO) regarding China's restrictions on the
export of key industrial raw materials.

The US has also been joined by the EU in the case as China has refused to cut export tariffs or raise quotas.

The US and EU contend that the export restrictions imposed by China provide an unfair advantage to
Chinese companies which distorts world competition thus violating WTO rules.
The petition, which is the first by the Obama administration against China, cites taxes on about 20 different
metals and chemicals that serve to limit exports giving an unfair advantage to Chinese manufacturers.

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Meanwhile in a move that underscores the increasingly apparent shift in the Chinese stand on protectionism
the Chinese government has issued a strong ''buy Chinese'' directive to government departments that are
disbursing part of its 5 trillion yuan stimulus package.

The US steel sector has also joined the debate saying that the Chinese government's increasing subsidies are
giving Chinese mills a competitive advantage.

"We believe China must comply with WTO rules," US Steel chairman and chief executive John Surma said
this week. "We believe subsidisation seriously undermines the global steel industry."

Questions:

1 How would you view the actions of china with WTO‘s objective of free and fair trade for everyone
and removing barriers to trade.?

(10)

2 If China does not reverse its decision, then what could be the reaction of EU and US?

(10)

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 IB06
International Business

Assignment II

Assignment Code: 2010IB06B2 Last Date of Submission : 15th November 2010

Maximum Marks: 100

Attempt all the Questions. All questions are compulsory and carry equal marks.

Section A
1. Describe in detail segmentation in International Markets? How does it help international
marketers?
(20)
2a. Describe the key attributes of successful Expatriate Manager.
b. Detail the reasons for many industries going in for international recruitment.
(10+10)
3. Describe briefly key export documents.
(20)
4. Write short notes on:-
(a) Wholly owned subsidiaries
(b) Make or buy decisions in International Business.
(c) Reasons for International Market Segmentation
(6+7+7)

Section B
Case Study:
A preferential trade agreement between India and the South American economic block MERCOSUR has
come into effect on 1 June. Under the PTA India and MERCOSUR will give tariff concessions raging from
10 per cent to 100 per cent to each other.

Total trade between India and the MERCOSUR block stood at $4773.39 million during the financial year
2007-08. India's exports to the MERCOSUR stood at $2904.8 million during 2007-08, while imports stood
at about $1,868.39 million during the same period.

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The major product groups covered in the offer are food preparations, organic chemicals, pharmaceuticals,
essential oils, plastics and articles thereof, rubber and rubber products, tools and implements, machinery
items, electrical machinery and equipments.

The break-up of the number of tariff lines for different MOPs (margin of preferences) is: - 10 per cent on
393 tariff lines, 20 per cent on 45 tariff lines and 100 per cent on 14 tariff lines.

India will offer preferential treatment to import of meat and meat products, inorganic chemicals, organic
chemicals, dyes and pigments, raw hides and skins, leather articles, wool, cotton yarn, glass and glassware,
articles of iron and steel, machinery items, electrical machinery and equipments, optical, photographic and
cinematographic apparatus.

The break-up of the number of tariff lines for different margin of preferences (MOP) is: 10 per cent on 93
tariff lines, 20 per cent on 336 tariff lines and 100 per cent on 21 tariff lines.

MERCOSUR, which groups Argentina, Brazil, Paraguay and Uruguay, was formed in 1991 with the
objective of free movement of goods, services, capital and people and became a customs union in January
1995.

India and MERCOSUR signed a framework agreement on 17 June 2003 at Asuncion, Paraguay with the
aim of creating conditions and mechanisms for negotiations in the first stage, by granting reciprocal tariff
preferences and in the second stage, to negotiate a free trade area between the two parties.

As a follow up to the said framework agreement, a preferential trade agreement between India and
MERCOSUR was signed in New Delhi on 25 January 2004 and five annexes to this agreement were signed
and incorporated on 19 March 2005. By this, India and MERCOSUR have agreed to give tariff concessions
ranging from 10 per cent to 100 per cent to each other on 450 and 452 tariff lines respectively.
Questions:

1. What benefits will India draw from the PTA with Mercosur?
2. What is the difference between PTA and FTA and why India and Mercosur have decided to
start with PTA.
(10+10)

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