company through foreign direct investment. These type of ventures are useful in that countries where the risk is low, markets are stable. These can be done for various purposes like to obtain raw materials, to make products for export to home country. Equity based ventures are further divided into wholly owned and joint venture (Phatak, Bhagat & Kashlak 2009).

Wholly Owned Subsidiaries: Subsidiaries in which foreign countries has full control and ownership in the host countries are called wholly owned subsidiaries. These are of two types:

Greenfield: Greenfield means set up a new entity in foreign company from scratch by using locally available sources.

Acquistions: It means to capture the existing business running in the foreign country.

Joint Venture: It means to establish a subsidiary in foreign company by two or more companies by sharing resources. It is effective when the amount of capital invested or risk is huge, a single company cannot afford it, markets are unstable and lot of risk is available in the host country. As Indonesia has lots of oil reserves and these requires lots of capital, joint venture is an effective way to enter that market (Meyer, Estrin, Bhaumik & Pen 2009).

Section 4:

Shell Indonesia: Shell Indonesia is a global company established in 1890 having headquarter in Jakarta. But it started its operation in Indonesia in 1884 when a Dutch Man found oil in Sumatra of Indonesia and started drilling by taking permission from Sultan Langkat. Shell Indonesia deals with oil and gas products. It has currently 79 sites in the Indonesia.

Shell operations in Indonesia: Shell plays an important role in lubricant, fuel and bitumen market. To satisfy requirements of mining, cement and electric power generator, it provides lubricant products to marine business. Shell lubricants like shell helix and shell advance are rising considerably in Indonesia. Shell helix is designed for 4 wheeled vehicles and shell advance is for 2 wheeled vehicles.