Title: Sunshine Powers Joint Venture in India

1. Why do you think British Petroleum has been so successful in securing an

international reputation? Due to the recent speculation and concern about the end
of the end of diesel and gasoline era, do you think that BP is taking sufficient
measures toward getting involved in developing and utilizing new forms of fuel?

British Petroleum has been so successful when it joined forces with a successful Indian
company, Tata Energy and it become one of the most successful and prestigious solar
power companies in the world. They established such a good relationship with the Indian
company which has been known among India citizen. Besides, BP want to sustain their
business so they developing the new form of alternative power by using solar energy.

2. Why might India be a good location for a company developing solar power
products? Give several reasons. What other countries do you think would be a
good choice for BP to develop its alternative energy manufacturing facilities?
Why?

India is a good location to develop solar power products because of their capabilities to
manufacture solar cells, assemble solar modules and balance solar power systems and
also provide the installation and service of solar power systems. Besides, it also
because of the expertise available in India itself and also because of the low labor costs
which able to work hard. The other countries might be third world country which this kind
of manufacturing facilities can provide a wide range of job opportunities that can help
them to improve their standard of living. Besides, by build this kind of manufacturing
facilities it also attracts other manufacturing companies to invest and develop their
factories there.

3. What do you think are the pros and cons of British Petroleum’s approach to
managing foreign direct investments? What might they do differently? Do you
think that it wise to allow these companies to maintain the management that is
already in place and allow them to operate with some independence from BP?

The advantages of BP’s approach to managing foreign direct investments are it will
create employment for the citizen. Besides, it also will bring capital, technology and
 managing resources which it’s beneficial to the host country. Furthermore, it also can
create healthy competition environment and it will promote the economic growth of the
host country which lead to the increasing of productivity growth, product and process
innovation and greater economic growth.

But the disadvantages of BP’s approach are the home country’s balance of payment will
suffer from the initial capital outflow required to finance the FDI and if the FDI
substitution for direct exports. Besides, the employment may also negatively affected if
the FDI is a substitute for domestic production.

But, BP merged with Indian company which gave the opportunity for both of the
company share their knowledge especially their technology information. Besides, the
government also plays their own role by controlling the shares of BP in their new
company, Tata BP Solar India Unlimited so it’s still bring the name of India. It is wise to
maintain the management that already in place and allow them to cooperate with BP.
This is because, both of the management teams will cooperate together and sharing
their knowledge so that they can develop their company to become successful.

4. Do you think it is an astute business decision to allow foreign companies to keep

their original brand after BP purchases them? Why or why not? In your opinion,
does this reduce the credibility of the British Petroleum brand, or increase it?

It is an astute business decision to allow foreign companies to keep their brand after BP
purchase then and this because it already established and well known will be easier to
attract potential buyers. Besides, it might not need a lot of expenditure on promoting the
companies. Furthermore, it will make the loyal buyers keep loyal to the companies even
though it bought by BP. It actually did not reduce the credibility of the British Petroleum
just because the brands of those companies are part of BP companies and it should be
separate identity.