ABSTRACT
Chapter 4 aims at extending the empirical analysis to analyse the technology strategies of the passenger car firms towards development and acquisition of technology in the context of the changing structure and the new policy regime. Empirical analysis suggests that policy changes during the 1980s and 1990s have increased dependence on imported technology, which is reflected in terms of growing expenditure on imports, on the one hand, and, on the other hand, declining investment in in-house R&D. Variation across firms in terms of their technology development and acquisition strategies was largely associated with firm-specific factors. In addition, poor performance of indigenous firms (HML and PAL), even after they entered in a series of technical and financial collaborations with international firms, could be attributed to the poor efforts towards technology absorption and continuous dependence on foreign firms for designs and manufacturing of models of cars. Further, the dependence on imported components and parts of HML and PAL had increased since the initiation of the liberalisation process.
