CBSE Class 10 Social Science Globalisation And The Indian Economy Notes Set B

Globalisation and the Indian Economy

How MNC’s interlink production across counties.
MNC’s set up production unit where it is close to the market where skilled unskilled labour is available at low cost, where government policies are favourable.
They invest money called foreign investment
At times set up production jointly with local companies.

Benefits local companies by providing latest technology and additional investment.
They buy local companies and expand production.
Place orders to small producers for products like Garments, footwear sports items etc.

How foreign trade leads to integration of markets?
Foreign trade creates an opportunity for the producer to reach beyond the domestic market.
Goods can be imported to expand the choice of goods for consumers.
Producers in two countries now closely compete against each other, prices tend to become equal.

Aim :- To liberalise international trade
Started at the initiative of the developed countries Set up rules regarding international trade.
Force developing countries to remove trade barriers
Developed countries have unfairly retained trade barriers

Impact of Globalisation
For consumers:- Improved quality, lower prices, variety of choices, higher standard of living.
Job have been created.
Local companies supplying raw material to MNC’s have become prosperous.
Top Indian companies have been benefitted from increased competition.
Some Indian companies also emerged as MNC’s e.g. Tata Motor, Infosys,Ranbaxy, Asian Paints

Struggle for a fair Globalisation
Fair globalisation would create opportunities for all.
The govt. must protect the interests of all the people in the country.
Government can ensure that labour laws are properly implemented and workers get their rights.
Government can negotiate at the WTO for farier rules.
It can also align with other developing countries.
Liberalisation of foreign trade and foreign investment policy.
Starting around 1991, barriers on foreign trade and foreign investments were removed to a large extent.
It allowed foreign companies to set up factories and offices in India.
Goods could be imported and exported easily.

Key Points to Remember:

• Globalisation is a process of international integration arising from the interchange of world views, products, ideas and other aspects of a culture.

• Multinational Corporation (MNC) is an enterprise operating in several countries but Managed from one country or group that derives a quarter of its revenue from operations outside of its home country.

• Liberalization refers to the reduction or elimination of government regulation or restrictions on private business and trade.

• Investment is the purchase of goods (such as machine, house, and other parts etc.) that are not consumed today but are used in the future to create wealth.

• Foreign Trade is basically trade between two different countries of the world. It is also known as international trade.

• World Trade Organization is the only global international organization dealing with the rules of trade between nations. The main aim of this organization is to liberalize the law of trade between the nations.

• Privatization is the transfer of a business, industry, or service from public to private ownership and control.

• Foreign Investment is when a company or individual from one nation invests in assets or ownership stakes of a company based in another nation.

• SEZ is a special economic zone of a country that is subject to unique economic regulations that differs from other areas in the same country. These regulations tend to be conductive to foreign direct investment.