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The case describes the Indian business environment and the enormous opportunities and challenges presented by rural markets as they expand rapidly. It focuses on the innovative business model deployed by ITC to engage the rural population in multiple ways and create a platform for procuring commodities and providing a range of goods and services to the bottom of the pyramid in rural India. It gives students the opportunity to evaluate the future of ITC's rural business.

The case describes the Indian business environment and the enormous opportunities and challenges presented by rural markets as they expand rapidly. It focuses on the innovative business model deployed by ITC to engage the rural population in multiple ways and create a platform for procuring commodities and providing a range of goods and services to the bottom of the pyramid in rural India. It gives students the opportunity to evaluate the future of ITC's rural business.

Most consumers who comprise "the bottom of the pyramid" reside in hundreds of thousands of villages located beyond most multinationals' distribution networks. Their access to essential goods is limited not just by high prices, but also by inadequate rural distribution, which also restricts the ability of poor producers to distribute their products. The term "socially responsible distribution" describes initiatives that provide poor producers and consumers with market access for goods and services that they can benefit from by either buying or selling, thus neutralizing the disadvantages they suffer due to inadequate physical links to markets, information asymmetries, and weak bargaining power. This article identifies how socially responsible distribution can be achieved by strategies that reduce costs, reinvent the distribution channel, or incorporate a long-term approach to investment. It offers guidelines for setting up distribution channels that integrate the rural bottom of the pyramid and identifies the payoffs from adopting them.

Corporate social responsibility has major implications for pricing decisions in some markets. An extreme case is the pricing of life-saving drugs in developing countries; industry critics have pointed to price as an obstacle to treatment and a factor in the deaths of millions of AIDS victims. Examines socially responsible pricing in the form of differential pricing across markets, taking into account ability to pay and social welfare. An analysis of AIDS drug pricing between 1999 and 2003 suggests that, in fact, the high prices of AIDS drugs in developing countries suboptimized contribution earnings in those markets. In the 1990s, multinationals could have earned greater contribution in developing countries by reducing prices, while also saving thousands of lives. However, that could have jeopardized earnings in developed countries, and this, together with other factors, created barriers to socially responsible pricing. Neither multinationals nor developing country governments can alone create conditions for socially responsible pricing to prevail. Identifies the role of different players in addressing barriers to socially responsible pricing, including multinationals, governments, nongovernmental organizations, and multilateral institutions such as the World Trade Organization and the World Health Organization. Also offers lessons for managers in industries with characteristics similar to the drug industry, where socially responsible pricing also may be needed, if not demanded.

In an effort to retain more corporate earnings, exercise more managerial control, and meet demands of local constituents, governments worldwide are seeking greater domestic ownership of foreign subsidiaries within their borders. A study of corporate responses to India's Foreign Exchange Regulation Act of 1973 (FERA) shows that multinational corporations facing forced equity dilutions have at least four strategic options available: strict compliance, exit, negotiation, and preemptive action. Certain practical considerations limit management's strategic options: the implications of setting a precedent, the corporation's decision-making structure, the level of bargaining power, the political climate, and management's own biases.