Globalization And

Globalization Impact on India

What is Globalization ?

“ A progressive process of economic integration of the economies of world ”.

(Economical Definition )

“ Is the process of international integration arising from the interchange of world views, products, ideas, and other aspects of culture”.

History Behind Globalization .

• Globalization was initiated by the member country of WTO(World Trade Organization ), then GATT (General Agreement on Tariffs and Trade ) in 1947.

• Globalization gain momentum after the eighth round of talks at Punta del esta in Uruguay and the transformation of GATT into WTO on 1st January 1995.

Objective Behind Globalization .

Globalization aims at unrestricted or free movement of factor of production and good and services across the

border .

Advantages And disadvantages of globalization

Advantages of globalization

• Increased free Trade between Nation .

• Resources of different countries are used for producing goods and services they are able to do most efficiently.

• Increased liquidity of capital allowing investors in developed nations to invest in developing nations.

Advantages of globalization

• Adverse impact of fluctuations in agricultural productions in one area can be reduced by pooling of production of different areas.

• Corporations have greater flexibility to operate across borders .

• Global mass media ties the world together.

Advantages of globalization

• Reduction of likelihood of war between developed nations .

• Reduction of cultural barriers increases the global village effect .

• Increased flow of communications allows vital information to be shared between individuals and corporations around the world.

• Increases in environmental protection in developed nations.

Disadvantages of globalization

• Exploitation of Underdeveloped Countries.

• Economic depression in one country can trigger adverse reaction across the globe.

• Increase in Unemployment.

Disadvantages of globalization

• Harmful Effects on Small Industries and Small Business.

• Widening of Rich-poor Gap.

• Adverse Effects on cultural heritage.

Disadvantages of globalization

• Greater risk of diseases being transported unintentionally between nations.

• International bodies like the World Trade Organization infringe on national and individual sovereignty.

• Dumping Goods in less develop country .

Disadvantages of globalization

• Increase in the chances of civil war within developing countries and open war between developing countries as they vie for resources.

• Decreases in environmental integrity as polluting corporations take advantage of weak regulatory rules in developing countries .

Globalization impact on

India

Globalization impact on India

• LPG model was introduce 1991 in India, before that India was largely and intentionally isolated from the world markets

The annual Average Growth Rate of GNP in India

Period GNP in %

(1992-97) 6.6

(1997-02) 5.5

(2002-07) 7.8

(However the growth rate in 2006-07 increased by 9.7%)

Globalization impact on India

The Economy of India is based in part on planning through its Five – Year plan.

Five – Year plan. Target (GDP) Achieved(GDP)

1st Five - Year Plan (1951-1956) 2.1 % 3.6 %

2nd Five - Year Plan (1956-1961) 4.5 % 4.0 %

3rd Five - Year Plan (1961-1966) 5.6 % 3.3 %

4th Five - Year Plan (1969-1974) 5.7 % 3.3 %

5th Five - Year Plan (1974-1979) 4.4 % 5.0 %

6th Five - Year Plan (1980-1985) 5.2 % 5.4 %

7th Five - Year Plan (1985-1990) 5.0 % 5.7 %

8th Five - Year Plan (1992-1997) 5.6 % 5.6 %

9th Five - Year Plan (1997-2002) 6.5 % 5.35 %

10th Five - Year Plan (2002-2007) 8.1 % 7.7 %

11th Five - Year Plan (2007-2012) 8.33 % 7.9 %

Average GDP after independence is 5.16%

Globalization impact on India

• Over the past decade FDI flows into India have averaged around 0.5% of GDP against 5% for China 5.5% for Brazil. Whereas FDI inflows into China now exceeds US $ 50 billion annually. It is only US $ 4billion in the case of India.

• Consider global trade - India's share of world merchandise exports increased from .05% to .07% over the past 20 years. Over the same period China's share has tripled to almost 4%.

• India's share of global trade is similar to that of the Philippines an economy 6 times smaller according to IMF estimates. India under trades by 70-80% given its size, proximity to markets and labour cost advantages.

Conclusion

Globalisation is a irreversible processGlobalisation does have problems and negative Effects, but it is not going to disappear

We need to learn how to reap its benefits , and Minimize its cost . To do that , we must :

• Understand its impact • Work to remedy the problem • Work to Spread the benefits as widely as possible