Page 198 - DECO303_INDIAN_ECONOMY_ENGLISH

Unit 11: Globalisation and Its Impact on India

11.4 Summary Notes

The implications of globalisation for a national economy are many.

Almost every aspect of modern life is shaped to some extent by processes of globalisation.
Globalisation has intensified interdependence and competition between economies in the
world market. This is reflected in Interdependence in regard to trading in goods and
services and in movement of capital.

As a result domestic economic developments are not determined entirely by domestic
policies and market conditions.

Rather, they are influenced by both domestic and international policies and economic
conditions. It is thus clear that a globalising economy, while formulating and evaluating
its domestic policy cannot afford to ignore the possible actions and reactions of policies
and developments in the rest of the world.

This constrained the policy option available to the government which implies loss of
policy autonomy to some extent, in decision-making at the national level.

11.5 Keywords

Developed Country: It is a country whose economy has become industrialised and technologically
advanced.

Developing Country: Country in the process of industrialisation and building technological
capacity.
Economic Nationalism: Economic nationalism is a term used to describe policies which are
guided by the idea of protecting domestic consumption, labour and capital formation.
Foreign Direct Investment (FDI): Investment by an organisation in a business in another country
with a view to establishing production in the host country.
Globalisation: It is a modern term used to describe the changes in societies and the world
economy that result from dramatically increased international trade and cultural exchange.
11.6 Review Questions

1. Define globalisation and its characteristics.
2. Discuss the impact of globalisation on the strategies of various organisations.
3. Is globalisation a threat or opportunity for Indian organisations? Discuss the statement.
4. What does globalisation mean for business, society and government?

5. Define the term MNCs.
6. Discuss the FDI norms.

Answers: Self Assessment

1. 1492 2. Global

3. Benefits and costs 4. Globalisation
5. Worldwide 6. Integrated

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