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##di for domestic investment, growth and employment need to be examined against the benefits that domestic companies derive elsewhere in terms of expanded market base, backward and forward vertical integration and cheap skilled labour. in a globalised business environment, establishing an overseas presence becomes inevitable on account of a country ’ s policy on outsourcing, emphasis on on - shore presence, protectionism, etc. hence, the indian companies have to balance the need for domestic business expansion with the compulsions of overseas investments. likely impact of devolvement of contingent liabilities it has been observed that in the recent years, the non - fund exposure in the form of guarantees issued by indian companies towards their jvs / wos has been rising ( table 1 ). given the uncertain global environment, exponential rise in issuance of guarantees could be a potential concern for banks ( who often provide back to back guarantees ) and the indian companies concerned. impact of economic downturn of foreign economies another important aspect that has to be borne in mind is that the overseas business model could go awry due to a variety of reasons, such as, sudden downward trend of the economy as experienced during the recent global financial crisis and the eurozone sovereign debt crisis. such events may adversely impact the financials of the indian companies with a spill - over effect on the domestic corporates and banking sectors. during the periods of global crisis, indian companies may face challenges to their overseas investments. this would be on account of moderation in internal accruals and also due to the funding constraints that maybe faced by indian jvs / wos arising out of faced by the multinational investment banks and financing institutions. indian corporates who had acquired overseas assets at much higher premium in a bullish phase of business cycle or did not undertake intensive due diligence before such acquisitions in anticipation of future growth, potentially risk huge valuation loss during the downturn. ensuring security through strategic acquisitions the emerging economies are becoming increasingly conscious of ensuring security in the fields of energy, commodity and food for the future generations. this has led to a spate of strategic acquisitions in the recent past, notable among them being acquisition of coal mines, oil fields etc. proposals for acquisition of overseas assets, particularly in the energy sector through special purpose fund or through the psus in the related field are now being discussed for long term strategic benefit of the country. various options of funding are also being debated. given the nature of our foreign exchange reserves, which have not been built out of surplus,