Islamic Banking in Pakistan,McDonald's in India and Walmart's Corrupt Practices-3 cases relating International Business have been discussed here.

1. INTERNATIONAL BUSINESS

2. CASE STUDY:
1. Islamic Banking In Pakistan
2. McDonald’s In India
3. Walmart’s Corrupt Practices

3. 1. ISLAMIC BANKING IN PAKISTAN
• Islamic banking is interest free banking system as
“Riba” or interest rate is not allowed in Islam.
• 1st Islamic bank : Mit Ghamr Savings Bank (1963) in
Egypt.
• Iran and Sudan have eradicated interest from their
financial systems.
• Pakistan Supreme Court gave the government a
deadline of 30 June,2001 for transforming the
country’s financial system to a purely Islamic one.

4. 3 ISSUES OF CONCERN REGARDING
THE CONVERSION
Large-scale
withdrawals by
depositors
Unscrupulous
borrowers
deceptively declaring
themselves bankrupt
Uncertainty created
by the transition
could scare off
foreign investors.

5. CONTINUED..
• It was decided in September
2001 that the shift to Shariah
compliant economy would be
made in a gradual, phased
manner and without causing any
disruptions.
• At present, consumers in
Pakistan can choose between
conventional and Islamic
banking.
12%
88%
Market Share of Islamic
Bank in Pakistan (Source:
Pakistan Today,2016)
Islamic Banks Conventional Banks

6. 2. MCDONALD’S IN INDIA
• McDonald’s started its operation in India in
October,1996.
• McDonald’s India is a 50-50 joint venture partnership
between McDonald’s Corporation, USA and 2 Indian
companies-Connaught Plaza Restaurants Private
Limited in North & East India and Hardcastle
Restaurants Private Limited in South & West India.
• McDonald’s customized its regular menu according to
Indian culture.

7. CONTINUED..
• Both vegetarian and
nonvegetarian lines
are offered in India.
• Chicken and mutton
instead of beef or pork
is used keeping in
mind the dietary
constraints of both
Hindus and Muslims.

8. MCDONALD’S “FRENCH FRY”
LAWSUIT IN SEATTLE
• In May 2001,a class action lawsuit was filed against
McDonald's in Seattle alleging that the company had
concealed the existence of beef in its French fries.
• McDonald's said it never claimed that its French fries
sold in the United States were vegetarian.
• McDonald's settled the suit for $10 million and
apologized for labeling the beef flavoring used for
seasoning as natural ingredients without further
specification.

9. SEATTLE EFFECT IN INDIA
• Hearing McDonald’s statement, furious Hindu
extremists launched protests. At some sites, the
protests were peaceful; at others, they turned ugly.
• McDonald’s explained that French fries sent to India
(unlike its North American fries) were free of beef
extracts.
• When laboratory tests revealed that no animal fat was
in the French fries, the issue receded in India.

10. CONTINUED..
• The negative publicity could not put a dent on
McDonald's business in India.
• McDonald's philosophy of QSCV (Quality, Service,
Cleanliness and Value) continues to be the guiding
force behind its service to the customers.
• From 38 restaurants in 2003, McDonald’s has at
present 300 restaurants in India.

11. 3. WALMART’S
CORRUPTION
• Walmart Stores Inc. is an American multinational
retail corporation.
• As of July 31, 2016, Walmart has 11,539 stores and
clubs in 28 countries.
• Walmart's first store outside the United States opened
in Mexico in 1991.
• Walmart acquired a majority position in Cifra, the
largest Mexican retailer (1997) and changed the name
to Walmart de México (WALMEX) in 2000.

12. PROJECTS THAT WALMEX COULD
UNDERTAKE FOR BRIBERY INCLUDE:
• A store in historic area of San Juan Teotihuacan by
changing the map of commercial-free zone.
• A Sam’s Club in a densely populated neighborhoods
without construction license, environment permit,
urban impact assessment or even traffic permit.
• A vast refrigerated distribution center in an
environmentally fragile flood basin area.

13. WALMART’S CORRUPTION
• When the Walmart leadership found growing evidence
of corruption against WALMEX, the responsibility for
investigation was surprisingly handed over to the
accused general council.
• Fellow Mexican executives were quickly exonerated
and the internal investigation was closed in 2006.
• In April 2012 The New York Times revealed in an
article that WALMEX used to offer large payoffs to get
what the law otherwise prohibited.

14. OUTCOME OF THE PROBE
• 3 year investigation by the U.S. Department of Justice
under the Foreign Corrupt Practices Act is not over yet,
but most of the legwork is done.
• The investigation has found a much smaller case than
the government initially expected. The case is likely to
end with only a fine and no criminal charges made
against individual Walmart executives. (Source:
Fortune.com)
• Corruption allegation has cost Walmart $650 million
since 2013, compliance efforts has grown.

15. REFERENCES
• Juan Solé,2007,IMF Working Paper: Introducing Islamic Banks into
Conventional Banking Systems. (pdf).Available at:
https://www.imf.org/external/pubs/ft/wp/2007/wp07175.pdf
(Accessed 29 August,2016)
• Islamic Mode Of Financing “murabaha”(online).Available at:
https://www.scribd.com/doc/59297750/Islamic-Banking-
Thesis(Accessed 29 August,2016)
• Islamic Banking Modes Moving Up In Pakistan,2016,Pakistan Today
(online). Available at:
http://www.pakistantoday.com.pk/2016/05/18/business/islamic-
banking-modes-moving-up-in-pakistan/ (Accessed 29
August,2016)

16. REFERENCES
• Goodstein L,2001, For Hindus And Vegetarians Surprise In McDonald's
Fries(online).Available at: http://www.nytimes.com/2001/05/20/us/for-
hindus-and-vegetarians-surprise-in-mcdonald-s-fries.html (Accessed 29
August,2016)
• Barstow D, Xanic A,2012,The Bribery Aisle: How Wal-Mart Got Its Way in
Mexico(online).Available at:
http://www.nytimes.com/2012/12/18/business/walmart-bribes-
teotihuacan.html?pagewanted=all&_r=0 (Accessed 29
August,2016)
• Wahba P,2015,Walmart bribery probe by feds finds no major misconduct in
Mexico (online).Available at: http://fortune.com/2015/10/18/walmart-
bribery-mexico/ (Accessed 29 August,2016)