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HomeOpinionDiaryEntry and exit of FDI: A case of Docomo- Part II

Entry and exit of FDI: A case of Docomo- Part II

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To be realistic, it was a dirty bomb by Tata Docomo! In fact, TD itself couldn’t keep a hold on mad rush for its sims! (rather ‘sins’). May be, the company was initially happy for its wittiness to increase its consumer base. But it turned to be a pseudo-consumer base! Sooner than later, the customers started getting call from the company to verify their ID proofs. The company had failed to manage the documents and it had ended up in a mess. Many customers had to re-submit their documents! This irked the consumers! Visiting a photocopy shop, again to get copies of photograph and then go to the simcard dealer, fill up the form and submit was really a tedious process. So people like me, who had bought sims only to ‘utilize’ the offer thought of finishing the talktime available in each of the sims and keep them somewhere safe so that they can be used for contact transfer when we change the phone!

In a way, the idea of increasing customer base had landed in a disaster! The reliability of quality of product for which TATA is popular for couldn’t really keep its stature in this game! Though at that point of time I didn’t think so much, but now when I think about it I feel, probably this low cost sim scheme might have been a boon for terrorists or anti-nationals. Even otherwise, they possess so many sims with them, and if it is available at a toffee rate, will they not utilize it!? Aren’t they ‘intelligent’!?

On a broader perspective, the entry of NTT Docomo, which is one of the best mobile operators in the World, was a very positive sign for India. As the TD website says, NTT Docomo provided cutting edge technology. Technologists at DOCOMO have defined industry benchmarks like 3G technology, as also products and services like i-Mode, e-wallet and a plethora of lifestyle-enhancing applications. Last year itself, while most of the rest of the industry were only beginning to talk of 4G technology and its possible applications, DOCOMO had already concluded conducting 4G trials in physical geographies, not just inside laboratories!

The investment by NTT Docomo was one of the biggest Foreign Direct Investments (FDI) in India. It had not only brought the much needed dollars to the country but also technology and human resource. Despite this, the company incurred losses in India and has finally decided to sell its shares and exit. But this exit will mark a black spot for Indian economy. If such a technologically advanced company fails to make profit in a country like India which has seen drastic increase in the number of households having cellphones from 7 per cent in 2004 to 82 per cent in 2011 – 12, then the possibility of other FDIs coming into country also becomes dismal. Not only in FDI terms, but also in terms of bilateral relations, Tata – Docomo partnership had helped in enhancing India – Japan relations.
If this partnership had become successful, then it would have attracted many more Japanese firms to invest in India. Now it was the right time for India to grab maximum investments from Japan under the regime of a pro-Indian Prime Minister, Mr. Shinzo Abe. Our neighbour China, though not in good terms with Japan due to Senkaku island issue, has presence of 10 times more number of Japanese companies than what India has. So, India should consider the exit of NTT Docomo seriously and address the issues to make the nation more investment friendly. Indian companies should devise right strategies to make collaborations successful.

Akshara Damle

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