Challenges faced by the Indian corporate sector:
(i) Threat from MNC: The massive entry and consolidation of multinationals in the Indian markets constitute another new challenge.
(ii) Competition: Liberalisation of trade has led to more and more competition from multinationals and from imports. Competition has become global in nature. Local tailor is facing competition from PETER ENGLAND and HONEST SHIRT.
(iii) World Class Technology: Competitive advantage and core competency rests largely on technological strengths. Investment in R & D (Research and Development) and innovation becomes inescapable for companies which enjoyed protection under the regulated regime. For example, Pharmaceutical industry made 2% investment in R & D in India.
(iv) Brand-Building: Expenditures were enhanced by companies on branding and positioning of products. The expenditures on the launch of the Korean brands like, Hyundai, LG and Samsung companies are good examples.