Globalisation means integrating the economy of a country with the world economy. In India, the process of globalisation picked up with the policy reforms of 1991. Globalisation refers to growing economic interdependence among countries in the world with regard to technology, capital, information, goods, services, etc.

1. A
Presentation
On
Globalisation and its impact on India
Stream :- MAM SEM – III
Prepared By :- 1. Dhorajiya Janvi H. (005)
2. Dodhiya Sophia S. (006)
3. Gami Harita S. (007)
Submitted To :- Miss. Charu Gupta
(ASS. Professor in Smt. Shantaben Haribhai Gajera
MBA Mahila College )

3. Introduction
• Globalisation means integrating the economy of a country
with the world economy.
• In India, the process of globalisation picked up with the
policy reforms of 1991.
• Globalisation refers to growing economic interdependence
among countries in the world with regard to technology,
capital, information, goods, services, etc.

4. Definition
“Globalisation means free movement of
capital, goods, technology, ideas, peoples. any
globalisation that omits the last the last one is
partial and not sustainable.”
- Branko Milanovic

5. Four parameters of Globalisation
Reduction of trade barriers to permit free flow of
good and services across national frontiers.
Creation of an environment in which free flow of
capital can take place.
Creation of an environment permitting free flow of
technology among the nation states.
Creation of an environment in which free
movement of labour can take place in different
countries of the world.

6. Features of Globalisation
Large scale production an marketing
inter-linking of economy of countries
Competition
Interdependence of countries
Transfer capital an technology
Inspire of multinational corporation of developed
countries

7. Advantages
Adopting of new production and trade patterns:
Globalisation will help in restructuring turning
production and trade practices in accordance with
the factor intensity of country.
Raise foreign capital: globalisation will attract
foreign capital which will lead to technological up
gradation.
Quality improvement: In order to withstand
competition offered by other firms, quality
enhancement will take place.

8. Cont…
Rise in employeement: It is expected that
integration between different sectors will lead to
more production in the home country. This will rise
employment will take place.
Reduce poverty: With globalisation , many micro-
credit programmes are being implemented to
priorities the needs of poor.

9. Disadvantages
Devastation of local producers: globalisation has
devastated local producers since they are unable to
compete with cheap imports.
Mounting strikers: Globalisation has led to
mounting workers unrest. Workers have protested
against low wages, despotic working condition,
autocratic management rule, long work days an
declining social benefits.

10. Cont…
Pubic employee are worse off: Globalisation has to
made public employees worse off. Public employee
are adversely effected by budget cuts, privatisation
and massive loss of purchasing price.
Small business are adversely affected: Small
business class is aversely affected by cutbacks of
public subsidies, de-industrialisation and floods of
cheap imports.

11. Cont…
Decline in income: During the globalisation phase,
about half a billion people in south Asia have
experience a decline in their income. The record so
far shows that it is the poor who have suffered
most.
Weak social safety net provisions: Since the
government`s ability to help he victims of
globalisation has been eroded, the provisions of
social safety net have been weakened.

12. Challenges face by global industries
Customer satisfaction
Attitude of Indian businessman must change.
Improve the quality of products to international
standards.
Face global competition

13. Opportunity for industries
Export products on large scale

14. Effects of Globalisation on Indian
economy
1. Indian`s foreign currency reserves were 141 billion dollars
in 2005 from 1 billion in 1991.
2. India`s share in world trade rose to 0.86 in 2003 from 0.53
in 1991.
3. Average growth rate of exports has been 10% p.a. during
1992-2004.
4. Current account surplus was between 0.7 and 1.08
percent of GDP in 2001-03.
5. External debt is growing by less than $ 3 billion per year as
compared to the earlier figure of $8 billion per year.

15. Cont…

17. Foreign investment flows
Foreign investment takes two forms – foreign direct
investment (FID) and foreign portfolio investment
(FPI).
FDI in total foreign investment improved to 54.8% in
1995-96 and FPI was still high at about 45%.
During the period of 2000-01 to 2012-13 share of
FDI was 60.3% and FPI was 39.7 %.

18. FDI Inflow
The government of India has been initiating attract
FDI inflows into India, certain Indian firm have been
undertaking investment project in other countries.
FDI inflows reveals that 52.0% of the total inflow
are made for developed countries,41.5% to the
developing countries.
Out of this flows, India received 1.9% in 2012.

19. FDI Inflow
years inflows outflows Net FDI inflows
1992-97 1,676(100.0) 96(5.7) 1,580(94.3)
2002 3,449(100.0) 1,107(32.1) 2,342(67.9)
2011 36,190(100.0) 12,456(34.4) 23,734(65.6)
2012 25,543(100.0) 3,583(33.6) 16,960(66.4)

20. Impact on labour
The latest estimates show that open unemployment
has increased over the last decade to about 188
million in 2003.
The rate of growth of employment which was of the
order of 2.04% year during 1983-94 declined to the
low level of 0.98% during the period of 1994-2000.
Social and personal services to 055% during 1994-
2000 as against 2.90% during 1983-94.

21. Inequality and poverty
ILO report(2004) states “Income inequality has
increased in some industrialized countries, reflected
in an increase in the share of capital in national
income”
The widening inequality has been result of very high
compensation paid by MNEs development of new
business with a global.

22. Main organisations for facilitating
Globalisation
I. International Monetary Fund (IMF)
II. The World Bank or International Bank for
Reconstruction and Development (IBRD)
III. World Trade Organization (WTO)

23. International Monetary Fund

26. The World Bank
World Bank is an organization affiliated with United Nation
and designed to finance productive project that further the
economic development of member nation.
World Bank headquarters are in Washington, D.C.
United Nation Monetary and Financial Conference at
Bretton Wood, in July 1944, the bank officially began
operations in June 1946.
Although, its loans were made for post-World War II
reconstruction, by 1949 the emphasis had shifted to loans
for the purpose of economic development.

27. Cont…
Current membership: 184 member countries
Shareholder: The five largest shareholder of the
Bank are USA, Japan, Germany, Great Britin and
France. India is the sixth largest contributor.
Total Capital: $171 billion
World Bank Group: It consists of International
Development Association (IDA), International
Finance Corporation (IFC), Multi-Lateral Investment
Guarantee Agency (MIGA), and International Center
for settlement of Investment Disputes (ICSID).

28. Objective of World Bank
1. Protecting the environment.
2. Investing in basic health and education programmes.
3. Promoting social development.
4. Assistance and encouragement to private business.
5. Promoting reforms which will create stable microeconomic
environment.
6. Strengthening the ability of the government to deliver
quality services.
7. Establishing peace time economy.
8. Maintaining equilibrium in the balance of payments.

29. Function of World Bank
1. To promote foreign investment and credit by
providing guarantee of repayment to the private
investors.
2. To assist its member countries by facilitating the
investment of capital for productive purposes.
3. To promote the long- term balance growth of
international trade and equilibrium in balance of
payment situation.
4. To settle disputes by ICSID office (International
Centre for Settlement of Investment Disputes).

30. World bank and India
India has been allotted a permanent sent on the Board of
Executive Director of the Bank.
India has the privilege of presiding the annual general
meeting of the Board.
India is the largest borrower of the world bank. The loan
from World Bank has helped India in the development of
coal industry, road construction irrigation project, water
supply and sanitation, off-petrol and refineries, power
project of Domodar Valley Corporation, etc.

31. World Trade Organisation(WTO)
The General Agreement Tariffs Trade(GATT) WAS
established in Geneva to pursue the objective of free in
order to help in the growth and development of all
member countries.
In 1947, 23 countries signed GATT.
India was one of the founder member of GATT.
In 1994, 118 countries were member of GATT.
The main purpose of ensure competition in commodity
trade by removal of trade barriers. The first seven round of
negotiation conducted under GATT aimed on imports
imposed by member countries.

32. Cont…
A preparatory committee was set-up by GATT which in turn
set-up the World Trade Organisation (WTO) IN 1995.
The WTO acts as a permanent watchdog of international
trade.
GATT was converted from a provisional agreement into a
formal international organisation called World Trade
Organisation (WTO) with effect from January 1, 1995.
It is directed by the ministerial conference that meets a
least once every two years and its regular business is seen
by the General council.

33. Features of WTO
1. 150 member countries membership.
2. It is the main organ of implementing the Multilateral Trade
Agreements.
3. It has a much wider scope than its predecessor GATT.
4. The representatives of the members and all officials of the
WTO enjoy international privileges.
5. Single voting right.
6. It is a full fledged international organization in its own right.
7.The WTO administers a unified package of agreements to
which all member are committed.
8. It is the forum for negotiations among its members,
whereby member nations discuss issues related to the
MATs and associated legal instruments.

34. Function of WTO
1. It provides the forum for negotiations among its members
concerning their multilateral trade relations.
2. It facilitate the implementation administration and
operation of the objective of the multilateral trade
agreements.
3. It administers the “trade review mechanism”.
4. It administers the “understanding rules and procedures
governing the settlement disputes”.

35. Cont…
6. It is watchdog of international trade. It examines the trade
Regimes of individual members.
7. Trade disputes that cannot be solved through bilateral talks
are forwarded to the WTO dispute settlement “court”.
8. It is management consultant for world trade. Its economists
keep a close watch on the activities of the global economy
and provide studies on the main issues of the day.

36. Fair Globalization need for policy
framework
ILO report states “ The economy is becoming
increasing global, while social and political
institutions remain largely local, national or
regional.”
The rules of world trade largely favor the rich and
powerful countries and more often work against or
ignore the interest of poor or weak countries.

37. Cont…
Good political government based on a democratic
political system, respect for human rights, rules of
law and social equity.
An effective state that ensures high and stable
economic growth, provide public services,
protection, raises capabilities of the people through
universal access to education and promotes gender
equity.
Strong representative organizations of works and
employers are essential for fruitful social dialogue.

38. Objectives fulfill by globalization
1. Macro-economic and employment generation
policy
2. Improving the productivity of employment
3. Balanced regional development
4. Social sector
5. Employment guarantee programme
6. Raising the productivity in informal sector
7. Promotion of skill development
8. Organizations of working poor

39. 1.Macro-economic and employment
generation policy
In the period of globalization expansion of public
sector employment was restricted, due to the
scheme of voluntary retirement and downsizing,
private sector in investment failed to fill the gap.
The MNCs apply high technology which reduce the
scope for enlarging employment.
The job can be entrusted to indigenous medium
sized industries and co-operatives. there is strong
need to provide credit, technology, marketing and
other support for purpose.

40. 2.Improving the productivity of
employment
The major problem of Indian economy is under-
employment. Out of unemployment of 7.32%, open
employment was only 2.81%, under employment
was only 4.41%.
It is necessary to provide work to unemployment
and new entrants to the labour force, and for this
purpose, employment strategies have to be woen
within the growth strategy.

41. 3.Balanced regional development
Out of 260 million poor in India in 1990-00, 165
million (63.4%) were living in UP, MP, Bihar, Orissa
and Maharashtra.
Our infrastructure are in place , it would be possible
to attract private sector investment.
The development of backward areas would help to
achieve the goal of balanced regional development
and lead to reduction in regional disparities.

42. 4. Social sector
Human capital formation helps in promoting
capabilities of the people benefits o globalization.
For increase its expenditure on education, health
and poverty alleviation programmes. It has further
increased need for acquiring skill who use in latest
high level of technology.
It is necessary for state to increase public
investment in social sector.
India spends 3.74% of GDP on education during
2003-04.

43. 5. Employment guarantee programme
So many programmes for the increase in education
rate, under employment were in initiated by the
government such as,
 Jawahar Rozgar Yojana (JRY)
 Employment Assurance Scheme(EAS)
 Pradhan Mantri Gram Sadak Yojana(PMGSY)
 National Rural Employment Guarnatee Act, 2004
Full employment has to achieved, 1.5 to 1.7% GDP
is not high cost for the programme.

44. 6. Raising the productivity in informal
sector
The informal sector is major source of employment. It
consists of small manufacturing enterprises, services or
vending in urban areas, domestic work and agricultural
work on small plot of land.
The goal must be make these informal activities part of a
growing formal sector that provide job, income and
protection and can trade in the international system.
A greater access to public infrastructure can also be helpful.

45. 7. Promotion of skill development
The government has realized the need for skill
development and set up a number of institution.
Private institution have also been set up o impart training
of computer courses, management courses, technical
courses etc.
Social motivated NGOs have to play a part so that younger
boys & girls belonging to poorer sections of society are
enabled to develop their skills and rise up in the income
ladder.

46. 8. Organizations of working poor
To save labour from the exploitation by Indian
government and MNCs, the voice of labour should
be avoid by government and employers.

48. Bibliography
Gaurav Datt & Ashwani Mahajan, 2013,Indian
economy, S. Chand & company Pvt. Ltd., New delhi.
K. Aswathappa,2004,essentials of business
environment, Himalaya Publishing House, Mumbai.