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Aravind Preeti Singh Neha Sharma Roshan Kumar Priyanka Singh Bidisha Goswami
What is Globalization?
Globalization has made the world flat as evidenced by the growing service sector within India
Globalization in India
The idea behind the new economic model, LPG was to make INDIA one of the fastest growing economies of the world. The Indian economy was in major crisis in 1991
foreign currency reserves went down to $1 billion inflation was as high as 17% Fiscal deficit was also high and NRI's were not interested in investing in India
India produces about 100,000 new engineers a year. About 3 times the number of the U.S.
But still only 1.6 million people are employed in IT and Service Center jobs.
Hewlett-
Packard, General Motors, IBM, Intel, Microsoft, Motorola, Texas Instruments, Yahoo
Disparate Taxation
Formal Sector
Informal Sector
Largely agricultural or village based
This actually only accounts for 60 M. Middle class-ness seems to include those going from living on $5 a day to $10.
Compulsory and free education (6-14 yrs) guaranteed with the Right to Education Bill 2005
Realitys Impact
Lacking Infrastructure
highway system.
Golden
Quadrilateral
Highway
Project
will
Scheduled Improvements
(European built
Vallapardam Ship Terminal in Kochi (southwest coast of Kerala) to be completed by Dubais DP World at a cost of $555 million
Indias source of strength and tragic weakness! Though outlawed in the constitution; it remains a
The following measures were taken to liberalize and globalize the economy.
1. Devaluation: To solve the balance of payment problem Indian currency were devaluated by 18 to 19%. 2. Disinvestment: To make the LPG model smooth many of the public sectors were sold to the private sector. 3. Allowing Foreign Direct Investment (FDI): FDI was allowed in a wide range of sectors such as Insurance (26%),
4. NRI Scheme: The facilities which were available to foreign investors were also given to NRI's.
Merits
The merits of globalization are as follows There is an International market for companies and for consumers there is a wider range of products to choose from. Increase in flow of investments from developed countries to developing countries, which can be used for economic reconstruction. Greater and faster flow of information between countries and greater cultural interaction has helped to overcome cultural barriers. Technological development has resulted in reverse brain drain in developing countries.
Demerits
The outsourcing of jobs to developing countries has resulted in loss of jobs in developed countries. There is a greater threat of spread of communicable diseases. There is an underlying threat of multinational corporations with immense power ruling the globe. For smaller developing nations at the receiving end, it could indirectly lead to a subtle form of colonization.
Conclusion
India gained highly from the LPG model GDP increased to 9.7% in 2007-2008 In respect of market capitalization India ranks fourth in the world
But seeing the positive effects of globalization, it can be said that very soon India will overcome these hurdles too.
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