Negotiating in the Indian Institutional Environment

As discussed in the opening chapter, the institutional environment of a country is often influential in shaping the ease or the difficulty of the negotiating process.1 This, in turn, has important implications for the potential of value creation in a given environment. When the negotiating process is relatively less challenging, there is greater scope for value creation. We would also surmise that when the potential for value creation is high, the country’s rate of growth may also accelerate. India has been growing very rapidly in recent years and is now often hailed as an emerging superpower. Indeed, a question in the mind of analysts and business commentators is can or will India overtake China? India’s transformation from the relatively introverted and stagnant economy of the 1970s and 1980s to an economy that is increasingly dynamic is a major shift in terms of how it is viewed by both insiders and outsiders. No doubt, the Indian institutional environment, or at least some components of it, have begun to shift, especially from the early 1990s when India initiated the process of reforming its economy. Growth has also accelerated and that is no doubt welcome both from an Indian perspective as well as from an external perspective, which now sees in India the possibility of a large market into which they could sell.