India to have more MNCs than China

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Rapid economic development brings with it a lot of benefits. One amongst them is the mushrooming of companies, which make their presence felt far and wide. Better known as MNCs, these companies have not just the local market but practically the entire world as their oyster. Take the case of US and Japan. When these economies were growing rapidly, they also churned out MNCs with constant regularity. The fact that globalization was taking place at a rapid pace and there was a revolution of sorts in information and communication technologies also helped matters.

And while these countries would continue to do the good work of the past, a leading business daily reports that they may not be able to match the firepower of India and China. Yes, that's right. It is India and China that are likely to produce the highest number of MNCs over the next decade and a half. Infact, India is even expected to overtake China in this matter by the year 2018 as according to the daily, more than 2,000 Indian companies would look to set up their operations abroad and thus, become Indian MNCs. Investment intensity and openness were the factors that are likely to work in India's favour. Indeed, with the speed with which Indian companies are taking to foreign shores these days, the target set by the report does not look like too much of a stretch.

UK is similar to Greece

The Greece episode has firmly put the spotlight on countries that have a similar problem. The others of the so called PIGS group of nations have cornered most of the criticism so far. However, if the world's leading bond fund PIMCO, is to be believed there is more to Government debt problems than just PIGS. PIMCO argues that UK, which is in the middle of its own debt problems, has a lot of similarities to Greece.

While the initial level of Government debt may be better in the UK than Greece, it should be noted that the annual borrowing level is pretty similar for both the countries. The British deficit is forecast to reach 12.6 per cent of GDP in the next year, almost matching the 12.7 percent that Greece had last year.

However, there is one crucial difference. While the Greece is tied to the Euro and hence, cannot print its currency, the UK has its own currency and hence, can pretty much print the same at will. Thus, UK can deal with the crisis by expanding its monetary base and devaluing its currency. In other words, while investors in Greek debt are likely to suffer from a huge one time loss, creditors to the UK might face a slow death as the value of their debt investments erodes gradually over the next few years.