Impact of Globalisation in India
Globalisation is defined as the increasing interconnectedness of countries, which plays a crucial role in economic development. This section focuses primarily on the integration of production and markets through multinational corporations (MNCs) and highlights key factors facilitating globalisation in India.
Integration through MNCs
MNCs have increasingly spread their production across the globe to take advantage of cheaper labor and resources, illustrated by the example of a large MNC sourcing components from different countries for assembly. This interlinked production process creates a web of economic relationships, where production is no longer localized but spread across borders.
Facilitating Factors
Several factors have led to the acceleration of globalisation, including:
- Technological Advancements: Improvements in transportation and communication technologies have made it easier and cheaper to conduct trade.
- Liberalisation of Trade: Post-1991, India began removing barriers to foreign trade and investment, enabling MNCs to operate more freely within the country.
- International Pressure: Organizations like the WTO have played a role in promoting open markets, although this has been a double-edged sword for developing nations.
Impact on Different Sectors
While globalisation has led to greater consumer choice and lower prices for certain goods, the benefits have not been evenly distributed:
- Consumer Impact: Urban consumers have enjoyed improved access to a variety of global products at competitive prices.
- Employment & Production: Conversely, small Indian producers often struggle due to intensified competition from MNCs and imports. For instance, local toy manufacturers faced significant market pressure due to cheaper Chinese imports.
- Working Conditions: Workers experience challenges such as job insecurity and lower wages, especially in industries like garments, where MNCs pressure exporters to cut costs.
Overall, the section provides insights into the complexities of globalisation in the Indian context, emphasizing the need for fair policies that ensure equitable benefits across various sectors.