India may overtake China as the largest source of new Multinational Corporations (MNC) from the emerging markets, with over 2,200 domestic firms forecast to open overseas operations over the next 15 years, said a PricewaterhouseCoopers (PwC) report.
According to the report titled 'Emerging Multinationals', the competitive landscape is set to transform over the next decade as Indian and Chinese multinationals lead the way in seeking new markets outside their home markets.
"India is expected to produce the most new multinational companies, overtaking China as the emerging world's largest source of new multinationals. Over 2,200 domestic companies are projected to open operations outside over the next 15 years (between 2010 and 2024)," the report said.
Driven by globalisation and the information and communications technologies revolution, the number of companies from the emerging markets choosing to set up operations abroad has increased in the past five years.
The report suggests this trend will continue over the next 15 years, as new multinationals from emerging economies rise in prominence on the global economic stage.
"It is encouraging to know that India will replace China as the largest source of new MNCs in the emerging world from 2018 onwards. The key drivers for this are the relative increase in both investment intensity as well as openness that the domestic economy offers," said Jairaj Purandare, PwC India leader for markets and industries.
India and China will be joined by an array of companies from Singapore, Russia, Malaysia and South Korea.
According to the report, some of these new MNCs will become international powerhouses and will require services all over the world, for example, to support their information technology and telecommunications networks.
PwC report said that more new MNCs are moving into developed economies as opposed to setting up their first foreign operation in a neighbouring emerging markets.
The global consultancy major used econometric techniques to project the number of new multinationals arising from a sample of 15 emerging economies over the next 15 years.
The countries analysed are - Argentina, Brazil, Chile, China, Hungary, India, Malaysia, Mexico, Poland, Romania, Russia, Singapore, South Korea, Ukraine and Vietnam.