2007 has been a standout year for India in terms of mergers and acquisitions. M&As became a part of the Indian business scene soon after the policy constraints on growth were lifted, with each year outperforming the previous one in the number and value of deals.

By last year, India was registering more outbound deals than inbound ones. Today as a result, it is possible for companies like auto-component maker Bharat Forge [Get Quote] to report significant earnings from its global operations.

A quick look at the numbers first. In calendar 2007, the total value of M&As stands at roughly $55 billion, slightly lower than $62 billion in 2006, according to data compiled by Business Standard's Research Bureau. But the numbers are less important than the nature of the deals -- and by that yardstick, 2007 represented a paradigm shift for Indian business.

Starting with Tata Steel's [Get Quote] acquisition of Corus in a competitive auction and ending with Tata Motors' [Get Quote] hopeful bid for automotive marques Jaguar and Land Rover, 2007 should be remembered as the year in which Indian business began to think big in earnest. For instance, when Tata Steel bought the Anglo-Dutch steelmaker Corus, it actually bought a steel company several times bigger than itself. At $13.65 billion, it was also the largest overseas acquisition by an Indian firm.

Not surprisingly, most newspapers chose to describe the deal as audacious. The same adjective was applied when the A V Birla group company Hindalco [Get Quote] bought Atlanta-based aluminium giant Novelis for $6.4 billion, the second largest foreign deal.

In both the Tata and Birla purchases, the point about such 'audacity' -- itself a welcome change from the earlier risk-aversion when it came to international dealings -- was that it was rooted in sound strategic considerations.

Steel and aluminium are ultimately tough commodity business in which scale and vertical integration determine competitive advantage. Given that, both the Corus and Novelis deals put domestic giants Tata Steel and Hindalco into the global reckoning in one stroke. Tata Steel became the world's sixth largest steel-maker, raising its profile against Lakshmi Mittal's Mittal Steel which had acquired the world's largest steel maker Arcelor the year before.

Similarly, the Novelis deal makes the Birla group the world's largest aluminium rolling company. Should Tata Motors acquire Jaguar and Land Rover, it will become the only Indian automobile player to be horizontally integrated from its impending Rs 1 lakh (Rs 100,000) car to one of the world's most revered luxury car brands, Jaguar.

The second key change that was shaped by 2007 M&A action was Indian businessmen's ability and willingness to parry global competitors. Up until then, most overseas acquisitions by Indian businesses were of stressed assets for which there were either few takers or the competition was desultory.

2007 saw Indian companies actually face off with feisty global competitors. For instance, the wind power company Suzlon [Get Quote] beat off a challenge from French company Areva to acquire Germany's RePower. For Corus, Tata Steel had to fend off a Brazilian bidder, and for Jaguar and Land Rover, Tata Motors has been in competition against a domestic rival (Mahindra & Mahindra) and also OneSource, the consortium headed by former Ford chief Jacques Nasser. These competitors are hardly pushovers.

That Indian companies chose to stay in the race and win shows that they are no longer afraid of globalisation.