Globalization and the Indian Economy

Q1) Explain the role of government to make globalization fair **
Ans: The government can play a major role in making fair globalization possible: Fair globalization would create opportunities for all, also ensures that the benefits of globalization are shared better. Government policies must protect the interest not only of the rich and the powerful but also of all the people in the country.

  • Government should ensure that labor loss are implemented and workers rights are protected
  • Government should support small producers to improve their performances till the time they become strong enough to compete with foreign competition
  • If necessary , Government should use trade and investment barriers
  • It can negotiate with W.T.O for fairer rules
  • It can also align with other developing countries with similar interest to fight against the domination of developed countries in W.T.O

Q2) Explain any three advantages of globalization ** (Globalization and the Indian Economy)
Ans: Globalization means integrating the economy of the country with the world economy.

  • Under this process goods and service along with capital, resources and technology can move freely from one nation to another .People get chance to use various kind of international products.
  • It has increased the movement of people between countries. People usually move from one country to another in search of better income, better jobs and better education. Earlier the movement of people between countries was less due to various restrictions.
  • Developments information and communication (IT in short) has brought revolution in telecommunication. It has made e-banking, e-commerce, e-learning, e-mail, e-governance a reality.

Q3) What is trade barrier? Why did the Indian government put up trade barrier after independence? Explain.***
Ans: The legal restrictions led by the government to regulate foreign trade are called Trade barriers. Tax on imports is an example of the trade barriers.
The Indian government had put barriers to foreign trade and foreign investment after independence to protect the domestic producers from foreign competition. Imports at the stage would not have allowed local industries to come up. Indian allowed imports of only essential items such as machinery, fertilizers and petroleum, etc. 

Q4).How would flexibility in labour laws help companies.**
Ans: The flexibility in labour laws has helped companies in being more competitive and progressive . For easing up labour laws, companies hire workers in more flexible way terminate employment if there are no jobs available. As the government eased up labour laws,Indian companies get huge orders from MNCs as more goods are being produced at cheap rates. This indirectly affects the workers who are employed on a temporary basis.


Q5) How was globalization benefited India? Explain with five examples**
Ans: Globalization has benefited India in the following ways:

  • People with education skills and wealth have benefited by globalization
  • Greater competition among producers (both local and foreign) has been advantageous to consumers, particularly the well-off section. Rich people enjoy improved quality at lower prices for several products and a higher standard of living.
  • MNCs have increased their investments in India  over the past 20 years industries such as cell phones , automobiles , electronic, soft drinks, fast foods and services such as banking.
  • New jobs have been created In all these industries and services.
  • Top Indian companies have benefited from the increased competition. They have invested in newer technology and production methods.
  • Some Indian companies have gained from successful collaborations with foreign companies. Globalization has enabled some companies to emerge as multinationals.

Q6) Describe the impact of globalization on Indian economy with examples ***
Ans: Impact of Globalization on the Indian economy

  • Greater competition among producers (both local and foreign), has been advantageous to consumers particularly the well-off section. There is greater choice before the consumers who now enjoy improved quality and lower prices of several products .
  • Globalization has led to a higher standard of living in urban areas .
  • MNCs have increased their investments in India in industries such as electronics, automobile, cell phones, soft drinks, fast foods and banking services, etc. thereby providing consumers with a vast variety of products new job opportunities have been created in these industries and services thereby increasing purchasing power.
  • Globalization has enabled some large Indian companies to emerge as MNCs like Tata motors, Infosys, Ranbaxy, Asian paints, etc.
  • Globalization has also created new opportunities for companies providing services particularly those involving IT (Information Technology) for example call centers.

Q7) What is Globalization? Describe the role of multinational corporation (MNCs) in promoting Globalization process.**
Ans: Globalization is the process of rapid integration or interconnection between countries through foreign trade and foreign investment. Over last 20-30 years there has been a tremendous increased in globalization with the increase in number of MNCs

  • MNCs set up by production centers worldwide with cheap labor is available market are near and government policies are favorable
  • They supplies produced goods to different countries
  • Countries of the world have come closer due to increased movement of people between countries
  • MNCs provide money for additional for faster production
  • MNCs bring with them the latest technology and know-how for enhancing and improving the production process   .

Q8).”The impact of Globalization has not been uniform”. Explain with the statement.***
Ans: The impact of globalization has not been uniform. The statement will be explained by the following reason.
The globalization has a negative impact on employment and real wages. Due to the introduction of new technology, the volume of production has been increased but not the employment as such ,the condition of our workers gets poor.
The globalization has benefited only the large industries,big traders, and capital and capitalists class.It increases the concentration of economic power and the wealth of people. It actually benefits MNCs on the domestic producers and the working class.

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