Page 192 - DECO303_INDIAN_ECONOMY_ENGLISH

Unit 11: Globalisation and Its Impact on India

In a nutshell, Globalisation can be featured by four key factors: Notes
1. Evolution of international organisations, particularly the WTO,
2. Emergence of Regional Trade Agreements/FTA as ASEAN, NAFTA,
3. Rising role of Multinational Corporations, and

4. End of the Cold War/Paradigm shift in former socialist economies.

Self Assessment

Fill in the blanks:
1. Long before ……………………, people began to link together disparate locations on the
globe into extensive systems of communication, migration, and interconnections.

2. This formation of systems of interaction between the …………………… and the local has
been a central driving force in world history.
3. The …………………… of the emerging global economy are being hotly debated among
business people, economists, and politicians.
4. The debate focuses on the impact of …………………… on jobs, wages, the environment,
working conditions, and national sovereignty.
5. Globalisation offers extensive opportunities for truly …………………… development but
it is not progressing evenly.
6. Some countries are becoming …………………… into the global economy more quickly
than others.

Caselet Product Strategy

t was a Coke’s CEO, the late Roberto Goizueta, who declared in 1996: “The labels
‘international’ and ‘domestic’…no longer apply.” His globalisation program, often
Isummarised under the tagline “think global, act global,” had included an
unprecedented amount of standardisation. By the time he passed away in 1997, Coca-Cola
derived 67% of its revenue and 77% of its profits from outside North America. To cross
borders, organisations have to face a very critical question that is Product Standardisation
vs. Product Adaptation.
Standardisation provides advantages in the production and distribution of products and
services. Cost is the decisive factor for most commodities. Through economies of scale
and through standardisation, an organisation can fulfil the demand of many nations through
one plant.
Even in consumer good economies, standardisation works at least at regional levels. Like
in India, Chinese toys took the advantage of reduction of tariff barriers and successfully
captured the Indian market. Similarly, in industrial goods like Processors, RAM, Chemicals,
etc., standardisation can save millions of Dollars. Globalisation also helps in establishing
world-class plants, which is a win-win situation as organisations reduce the cost and the
customer gets the product at an economical price. Standardisation is not possible in all the
goods, specifically in most of the consumer goods.
Contd...

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