IILM GRADUATE SCHOOL OF MANAGEMENT

POST GRADUATE DIPLOMA IN BUSINESS MANAGEMENT (2005-07)

End-Term Examination, Trimester-V, December 2006
Course Code-05-PGIE-259 Global Marketing of Services

Thursday, 28th December 2006, Duration: 2 hrs (9=30 AM to 11=30 AM)

Maximum Marks: 60
INSTRUCTIONS
1. Part-A is compulsory and carries 12 marks.
2. Attempt ANY FOUR Questions from Part-B.
3. All Questions in Part-B carry equal marks (12 marks each).
4. Answers should be brief and to the point.
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Part-A:

1. Indicate whether the following statements are TRUE or FALSE (no explanation
is necessary): [12 Marks]

1.1. Foreign Institutional Investors (FIIs) are allowed to buy shares in Indian stock
markets subject to individual limit of 5 percent of total equity in a firm.
1.2. Non-Resident Indians (NRIs) are allowed to buy shares in Indian stock markets
subject to individual limit of 10 percent of total equity in a firm.
1.3. Overseas Corporate Bodies (OCBs) are allowed to buy shares in Indian stock
markets subject to individual limit of 5 percent of total equity in a firm.
1.4. Foreign Institutional Investors (FIIs), Non-Resident Indians (NRIs) and Overseas
Corporate Bodies (OCBs) are allowed to buy shares in Indian stock markets subject
to overall limit of 49 percent of total equity in a firm.
1.5. Foreign investment up to 74 percent of total equity is permitted in private banks.
1.6. Foreign investment up to 74 percent of total equity is permitted in banks doing
business only in insurance services.
1.7. Foreign investment up to 74 percent of total equity is permitted in airlines.
1.8. Foreign investment up to 74 percent of total equity is permitted in mobile phones.
1.9. Foreign investment up to 26 percent of total equity is permitted in insurance
companies.
1.10. Presently 35 foreign banks are operating in India.
1.11. The statutory cash reserve ratio (CRR) for commercial banks presently stands at 6
percent.
1.12. The statutory liquidity ratio (SLR) for commercial banks presently stands at 15
percent.
1.13. The Prime Lending Rate (PLR) of commercial banks presently exceeds 12 percent.
1.14. Foreign banks are not allowed to establish 100% subsidiaries in India.
1.15. India now allows foreign banks to set up 25 new branches per annum in India.
1.16. Overseas banking units operating in the Special Economic Zones (SEZs) are
exempted from prudential requirements of the Reserve Bank of India.
1.17. Entry of foreign banks in India is not allowed if its total assets exceed 15 per cent of
total assets of all domestic banks in India.

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1.18. India does not allow FDI in retail trading (except for singe brand name).

1.19.
1.20. Rupee is fully convertible on current account.
1.21. Rupee is also fully convertible on capital account.
1.22. Indian firms are not allowed to raise foreign funds from international stock markets.
1.23. Foreign companies cannot use their trademarks and brand names in India.
1.24. India is now a member of the Multilateral Investment Guarantee Agency (MIGA).
1.25.

Part-B- Answer Any Four Questions

2.
[4 X 3 = 12 Marks]

(a) What is the assessment of developing countries on the impact of the WTO
General Agreement on Trade in Services (GATS) on services trade?
(b) What is the assessment of WTO Secretariat on the impact of WTO-GATS on
services trade?
(c) Which opinion would you agree and why?

3. [4 X 3 = 12 Marks]

(a) Indicate different forms of capital flows from one country to another.
(b) Indicate their relative advantages and disadvantages in terms of cost of raising
capital, return, inherent risk and contingent liabilities.
(c) What are the special advantages of Foreign Direct Investment (FDI) over other
forms of external capital flows?

4. [4 X 3 = 12 Marks]

(a)Discuss broad types of Foreign Direct Investment (FDI).

(b)Which one is the dominant type of FDI flows to India and what are main reasons
for that?
(c)Indicate the major home countries of FDI inflows to India.
(d)Which are the major sectors attracting FDI to India?

5. [4X3 = 12 Marks]

(a) Discuss policies, strategy and regulatory regime for Indian overseas investment.
(b) Indicate the major home countries and the factors attracting Indian overseas
investment.
(c) Which are the major sectors and the strengths of the Indian outward investment?

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6. [6 X 2 = 12 Marks]

(a) Indicate the names of top Indian companies in terms of cross-border M&As.
(b) Indicate some of the crucial cross-border acquisitions made by Indian companies
since 2000.

7. [4 X 3 = 12 Marks]

(a) Discuss the status of negotiations on services trade under WTO-GATS.

(b) Discuss the functions of the Committee on Trade in Financial Services, and
arrangements for disputes settlements.
(c) Discuss the GATS views on domestic regulations on financial services and
recognition of prudential norms by member countries.

8. Write short notes on Any Three of the following: [4 X 3 = 12 Marks]

(a) Flying Geese Model on technology transfer

(b) Constraints on attracting FDI in agriculture, minerals and public utilities
(c) Role of fiscal and other incentives for attracting FDI
(d) Scope and definitions of financial services under WTO-GATS.
(e)
(f) Commitments of India for financial services under WTO-GATS.
(f) Globalization and its impact on prices and quality of services.

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