Joint Ventures

 Meaning:
Joint ventures are a combination of two or more independent firms that decide to participate in a business venture by contributing to the equity capital of the newly established organization.

Joint venture can take place (i) within the national boundaries, and (ii) across the national boundaries.

(a) Joint ventures within the national boundaries:

This type of joint venture takes place between two or more independent companies within the country; operating in the private sector or a private undertaking and the Government. Cochin Refineries and madras Refineries are the examples of joint ventures of the Government and the private undertakings.

Such joint ventures are taken to-
(i) accelerate the growth of the economy;
(ii) Introduce new technology in the market;
(iii) Minimize the risk of new venture.

(b) Joint ventures across national boundaries:

When two or more companies of different countries participate in a business venture, joint venture takes place across the national boundaries.

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