Country Risk Analysis: NEPALSubmitted by:Nishant HaranFPB1517/007Section-BPGDM-1517

Submitted to:Prof. Rajiv

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Reasons for choosing Nepal

• Raw Material source

• Emerging Market

• Creating opportunities for the people in Nepal

• Neighbouring country

• To build long term relation ship

• To help Nepal natural calamities it faced

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Environmental Analysis(1/2)

Legal factor• Emergency situation• Less Tax• Free market economy• Good relation with India• Less Documentation• No standards required

Ecological Factor• Climate• Land use• No area with ocean and seas• Low reserves• Natural Disasters

Political Factor• Terrorism• Influences in India• Instability• Longer decision making time

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Environmental Analysis(2/2)

Economical• Poor economy• Population growth• Economic growth• Unemployment• Poor infrastructure• Less rural development

Social Factor• Human development• Increased expectancy• Gender discrimination• Rise in educational level• Religion• Nuclear and joint family• Ethical behaviour

Technological• Backdated technology

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Porters Five Diamond Theory

Firm strategy, structure

and rivalry

Demand condition

Related and supporting industries

Factor condition

Economic Growth

Weak Commercial service

No Backward linkage

Poor infrastructure

Raw capital

Cheap labour

Low cost of capital

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Strategies to enter into Business with Nepal(1/2)

Exporting

Advantages Disadvantages

Avoidance of initial high cost

High transportation cost

Gather experience Problem with local distribution network

Joint venture

Advantages Disadvantages

Access to local partners knowledge

Lack of control

Sharing costs Inability to enter into global strategic coordination

Politically acceptable Lack of inefficient technology

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Strategies to enter into Business with Nepal(1/2)

Wholly owned subsidiary

Advantages Disadvantages

Protection of technology High cost

Ability to control High risk

Ability to realize location and experience economics

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Recommendation

Export

Level of risk

Political Instability

Availability of raw materials

Market expansion

Government restrictions

Action plan

Setting up office

Network based distribution

JIT approach

Global product

Research and development

Services

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Conclusion

High growth potential though have economic problems

Satisfactory environmental analysis

Should go for exporting rather than any other form of trade

Following the action plan will lead to the destination

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Country Cluster

• Company entering into the Nepal have advantage of entering into• India

• Sri Lanka

• Pakistan

• Bangladesh

• Afghanistan

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Thank you for your kind patience