Foreign Control, Financial Structures and Financial Performance of Japanese and Us Firms in Indian Manufacturing

The paper attempts to examine whether subsidiaries from different countries-of-origin differ with respect to their financial structures and performance in the same host country and whether greater foreign control affects their financing patterns and financial performance. The results show that Japanese firms differ significantly with respect to their financial structures from the Indian firms and perform financially better than them; however, U.S. firms have adapted themselves to the Indian financial environment. Their financing patterns as well as the financial performance do not differ much from the Indian firms. Higher foreign control in the subsidiaries affects their financial structures but not their financial performance.