Coca-Cola first entered India in 1956, operating with 100% foreign equity due to the lack of a foreign exchange act at that time. The Indian Foreign Exchange Regulation Act was introduced in 1973 during Indira Gandhi’s tenure. This act required foreign companies selling consumer goods in India to invest 40% of their equity in Indian associates. Although Coca-Cola agreed to invest 40% of its equity in India, it insisted on retaining full control over technical and administrative functions, excluding local participation.
This stance conflicted with the foreign exchange act. Consequently, the government instructed Coca-Cola to either revise its plan or exit the country. In 1976, Indira Gandhi called for elections, leading to the formation of a unified opposition under the Janata Party. The Janata Party came to power in 1977 and demanded that Coca-Cola either comply with the foreign exchange act or leave India. Coca-Cola chose to leave that year.
Following Coca-Cola’s departure, George Fernandes commented:
“Coke had 100% equity in India. Their investment was minimal—Rs. 6,00,000, equivalent to less than $20,000 at the time. From this investment, they repatriated an estimated 250 million rupees (about $8 million) in profit over twenty years.”
In 1993, Coca-Cola re-entered the Indian market, benefiting from new liberalization policies. The revised foreign exchange regulations allowed for up to 51% foreign equity and provided automatic approval for technology agreements in high-priority industries. Foreign investors and companies could now hold up to 100% equity in these sectors, with greater freedom for repatriating capital.
In 1999, Coca-Cola acquired Parle, India’s leading soft drink brand, which included popular beverages like Thums Up, Limca, and Gold Spot. Prior to the re-entry of Coca-Cola and Pepsi, over 50 Indian soft drink brands had emerged, and 200 production plants had been established. However, as Coca-Cola and Pepsi gained market dominance, many indigenous drinks disappeared, and the demand for healthier options declined.
indeed it was the correct and meaningful input for those who really understand the the SWOT and PEST which made the Coca-Cola a successful one in the beverage industry but still a lot has to be done to make it much better in all aspect.
by opening coca cola v can chears ourself by just glippering teeths of cold, delicious look and an open happyness
it is really informative and it provide basic of coke India history….
history is very intresting and clear….
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I have a photograph of late Prime Minister, Jawaharlal Nehru. The photograph was taken in hot sun when Panditji was seeping a cold drink holding a bottle in his hand. (I do not know which drink the the bottle contained) The picture was taken on August 18, 1956 when he visited the construction site of the New Major Port at Kandla.
If Coca was in India in those days, the bottle could be of Coca Cola.
If this information is of any use to you, kindly contact me.
I have the original B & W Negative.
above information has very good and we can get the glimpse of coca cola company how it has changed its policy and their interest to capture Indian market because of vast population and IFE policy was get modified
The photograph was taken in hot sun when Panditji was seeping a cold drink holding a bottle in his hand
I think Mr.Panditji was ambassador of coco cola…in 1956. 🙂
the article got me all the information thanks
Coco cola damage our indigenous healthy drinks
The power production supply
This really help me in my project and give all necessary information about the coca cola company…. Thanks
Can u suggest me some links about the company in mail… I am doing a research project on company from nit