Question

Essay on impact of globalisation on indian economy

Answer 1

Answer:

For example, think of a small village market or meal where all are free to come and sell their products at their desired price, irrespective of places from where they come. There are no restrictions on control on their products or the prices. This is the globalised trade. Any country can participate to set up, acquire, merge industries, invest in equity and shares, sell their products and services in India.

Therefore, globalisation should not be considered in isolation, but should be considered in totality with liberalisation of the industrial policy towards lifting of trade control and restrictions, influence of trade block and simultaneous privatisation.

Global market treats the world as a single market. With the advent of information technology and its strategic application, the world is focussed as a global village and all traders are therefore globalised.

Answer 2

Answer:

• The world is more interdependent now than ever before.The term globalization refers to the process of interaction and integration across society and economies. It covers the changes in economic, social and political domain as well as the mode of communication, transportation, technology and flow of ideas across borders.

• As the multinational companies manufacture products in some countries but sell it across the world. Globalization is not only removing barriers among economies but also the culture and social life is being affected by it.In the nineties, the restriction on the trade and investment was removed and this removal of barrier accelerated the rapidity of globalization in India.

• In the early 1990s, India unlocked its economy to the world because of the foreign exchange crisis that led to defaults on loans of the economy. There was a sudden policy change in India with the notion of new economic model known as Liberalization, Privatization and Globalization in India (LPG). In the early nineties, the key measures instigated as a part of the policy like, the abandoning of licensing of industries, the reduction in the areas of public sector, amendment in the monopolies and the controlled trade systems function, initiate privatisation programme, lessening tariff charges and the most important was to switch to the market determined exchange rates. This change in the policy had dramatic effects on the expansion of the Indian economy. This all changes were actually the announcement of the fusion of Indian economy into the global economy. Over the years with the policy change, more and more sectors begin foreign direct investment and portfolio investments and attracted foreign investors in telecom, airports, insurance, roads, ports, airports, transportation and much more.

• In general, the impact of globalization on employment is conflicting. As India is having the second largest world population, so to know the exact rate of unemployment is difficult. The large numbers of labour are pushed towards unorganized or unnamed group of workers so the surplus of supply give rise to disequilibrium situation or disproportions in the labor market. The large production firm may abuse the natural resources and use them inefficiently. And the domestic producer are being overpowered by MNCs who are already having competitive advantages over domestic industrialist in India, have more funds to invest. This will lead to further closure of local businesses.

• At the time of global recession in the year of 2007, India obtained greatly from the LPG model as its GDP increased to 9.7% in 2007-2008. India is enjoying fourth position in market capitalization in the world. However, yet the condition of agriculture has not enhanced after the globalization and are given less importance than other sectors contributing to economy. The share of agriculture in the GDP is only 17%. But considering the optimistic outcomes of globalization, India is capable of trouncing these obstacles and can advance more strongly on its way of development. The implications of globalization for an Indian economy are many. Globalisation has intensified the economic war between economies rather than the nuclear war. It is consequently apparent that a globalising economy, despite the fact that framing and estimating its policy cannot overlook the feasible activities, responses of policies and progress on the globe. and that’s results in restraining the alternatives of policy that are accessible to the government and that demand for loss of policy independence to some level, in decision-making at the national level.

• To conclude, it can be claimed that the advantages of economic reforms on the Indian economy would be attained, only if the negative impacts that mentioned above such as, unemployment, over growing population, closing down of local businesses and more would be diminished. Along with that, globalization and reformation the economic policies, efforts should be taken to understand the potential labour force and provide required security for work, income and life so that they would also benefit in that process on the one hand, and on the other, contribute towards the success of globalization.