Topic: Globalization

Group Members:

Industrial policy act

The new industrial policy was announced on july 24 1991, by the government, headed by prime minister P.V Narsimha Rao

Main features
Privatization Liberalization globalization

privatization

privatization refers to transfer of any government function to the private sector - including governmental functions like revenue collection and law enforcement.[1]

Globalization

Introduction of Globalization

Globalisation happened in 1991 in India. Its main intention was to liberalise, privatise and Globalise the industrial sectors. Industries were facing so much government intervention, so after that industrial sectors became almost free to make their own decision about establishing a new branch, producing the products and marketing etc,. Drastic change is that now the Indian consumer is free to purchase the product which he likes from anywhere in the world.Foreigners can also buy from India, so the economies off all the nations are interdependent on other.

Definition of Globalization:

Globalization is a term that includes a wide range of social and economic variations. It can encompass topics like the cultural changes, economics. Globalization helps in creating new markets. Dismantling of trade barriers between nations and the integration of the nations economies through financial flow, trade in goods and services, and corporate investments between nations.

Assume that you are a mango farmer and you grow very good quality mangoes . Obviously, your fruit is highly appreciated in India, but you also know that you shall get a better value in US. So the network of communication and execution that allows you to sell your fruit in US is basically, the phenomenon of globalization.

Globalisation could involve all these things!

Measures towards globalization

Convertibility of rupee Import liberalization Opening the economy to foreign capital

Aspects of globalization
Globalization has various aspects which affect the world in several different ways Industrial - emergence of worldwide production markets and broader access to a range of foreign products for consumers and companies. Particularly movement of material and goods between and within national boundaries. International trade in manufactured goods increased more than 100 times (from $95 billion to $12 trillion) in the 50 years since 1955.[15] China's trade with Africa rose sevenfold during 2000-07 alone.[16][17]

Financial - emergence of worldwide financial markets and better access to external financing for borrowers. By the early part of the 21st century more than $1.5 trillion in national currencies were traded daily to support the expanded levels of trade and investment.[18] As these worldwide structures grew more quickly than any transnational regulatory regime, the instability of the global financial infrastructure dramatically increased, as evidenced by the Financial crisis of 2007 2010.[19]

Economic - realization of a global common market, based on the freedom of exchange of goods and capital.[23] The interconnectedness of these markets, however, meant that an economic collapse in one area could impact other areas.[citation needed] With globalization, companies can produce goods and services in the lowest cost location. This may cause jobs to be moved to locations that have the lowest wages, least worker protection and lowest health benefits. For Industrial activities this may cause production to move to areas with the least pollution regulations or worker safety regulations.

Health Policy - On the global scale, health becomes a commodity. In developing nations under the demands of Structural Adjustment Programs, health systems are fragmented and privatized. Global health policy makers have shifted during the 1990s from United Nations players to financial institutions. The result of this power transition is an increase in privatization in the health sector. This privatization fragments health policy by crowding it with many players with many private interests. These fragmented policy players emphasize partnerships and specific interventions to combat specific problems (as opposed to comprehensive health strategies). Influenced by global trade and global economy, health policy is directed by technological advances and innovative medical trade. Global priorities, in this situation, are sometimes at odds with national priorities where increased health infrastructure and basic primary care are of more value to the public than privatized care for the wealthy.[26]

Political - some use "globalization" to mean the creation of a world government which regulates the relationships among governments and guarantees the rights arising from social and economic globalization.[27 ] Politically, the United States has enjoyed a position of power among the world powers, in part because of its strong and wealthy economy. With the influence of globalization and with the help of The United States own economy, the People's Republic of China has experienced some tremendous growth within the past decade. If China continues to grow at the rate projected by the trends, then it is very likely that in the next twenty years, there will be a major reallocation of power among the world leaders. China will have enough wealth, industry, and technology to rival the United States for the position of leading world power.[28]

IMPACT

Indias growth rate in the 1970s was very low at 3% and GDP growth in countries like Brazil, Indonesia, Korea, and Mexico was more than twice that of India. Though Indias average annual growth rate almost doubled in the eighties to 5.9%, it was still lower than the growth rate in China, Korea and Indonesia. The pick up in GDP growth has helped improve Indias global position.

Indias position in the global economy has improved from the 8th position in 1991 to 4th place in 2001; when GDP is calculated on a purchasing power parity basis.

During 1991-92 the first year of Raos reforms program, The Indian economy grew by 0.9%only. However the GDP growth accelerated to 5.3 % in 1992-93, and 6.2% 1993- 94.

A growth rate of above 8% was an achievement by the Indian economy during the year 2003-04.
India is ranked 18th among the worlds leading exporters of services with a share of 1.3% in world exports

POSITIVE IMPACT OF GLOBALIZATION

Goods and people are transported with more easiness and speed Free trade between countries increases Global mass media connects all the people in the world As the cultural barriers reduce, the global village dream becomes more realistic there is a propagation of democratic ideals The interdependence of the nation-states increases Outsourcing Access to the latest technology Promotion of healthy competition Improvement in human rights

Large Number of Multinationals Have Moved to India Post Globalization (Strategy 100% Equity, Collaboration, Franchise, Importing, Manufacturing)

Beverages (Coke, Pepsi) Fast Foods (McDonalds, Pizza Hut, KFC) Coffee (Barista, Caf Coffee Day) Sports Wear & Goods (Nike, Adidas) Apparels & Garments (Levis, Reid & Taylor) Cosmetics (Revlon, Oriflamme, Maybellene) Two/Four Wheelers (Honda, Toyota, Suzuki, Hyundai, General Motors, Ford, Mercedes) Computers (Del, HP, IBM, Samsung, Sony, Compaq) White Goods (LG, Samsung, GE) Construction Engineering Companies Pharmaceuticals (US, Europe, Britain) Music (Sony, BMG, Warner) Entertainment Channels (Star, National Geographic, Discovery, Sony) Sourcing (IKEA, Adidas, Nike, many others)

Globalization and its impact On Globalization Indian Industry.

Globalization of the Indian Industry took place in its various sectors such as steel, pharmaceutical, petroleum, chemical, textile, cement, retail, and BPO. The various beneficial effects of globalization in Indian Industry are that it brought in huge amounts of foreign investments into the industry especially in the BPO, pharmaceutical, petroleum, and manufacturing industries. As huge amounts of foreign direct investments were coming to the Indian Industry, they boosted the Indian economy quite significantly. This helped reduce the level of unemployment and poverty in the country. Also the benefit of the Effects of Globalization on Indian Industry are that the foreign companies brought in highly advanced technology with them and this helped to make the Indian Industry more technologically advanced.

It increased competition in the Indian market between the foreign companies and domestic companies. With the foreign goods being better than the Indian goods, the consumer preferred to buy the foreign goods. This reduced the amount of profit of the Indian Industry companies. The effects of globalization on Indian Industry have proved to be positive as well as negative. The government of India must try to make such economic policies with regard to Indian Industry's Globalization that are beneficial and not harmful.

Negative Effects of Globalization:

Increase in unemployment in local labor market Exploitation of labor Job insecurity Threat of terrorism Increase in population Uneven distribution of income Bad aspects of foreign cultures Foreign acquisitions Increase in prices Influence on local political decisions and affairs.

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