GLOBALISATION AND THE INDIAN ECONOMY

We are living in the age of technology when distances of time and spaces have current and the vast big world of ours has become one global village.

Globalization is a process which draws countries of their insulation and makes them join the rest of the world in the march toward a new world order. It means the growing interconnectedness of the modern world. The increased ease of movement of goods, services, capital, people and information across national borders is rapidly creating a single global economy.

Globalization has witnessed a phenomena expansion in international trade flows and is characterized by the growth of transnational companies which now account for about a third of world output and two third of world trade.

Managed wisely, the new wealth being created by globalization creates the opportunity to lift millions of worlds’ poorest people out of their poverty. Managed badly, it could lead to their further marginalization and impoverishment. Neither outcome is predetermined; it depends on the policy choices adopted by the government intersociety. It developing countries like India are to effective systems of government and action against corruption, they need to ensure respect of human rights, and to promote security, safety and justice for all violent conflicts. Violence must be prevented and markets made work better for poor people.

Globalization gives added urgency to the tasks of strengthens government systems in developing countries.

Private capital is highly mobile and will go to where business can be carried out safely and where it can make the best return. Weak and ineffective states, with problems of corruption, inadequate structure and cumbersome bureaucratic procedure are not attractive destination for that flows. By contrast, those countries that apply rules and policies predictably ensure law and order; invest in human capital (particularly education and health) and protect properly rights, are likely to attract higher level of inward investment and trade to generate faster economic growth.

To successfully globalize, India has to shepherd its economy along two dimensions, building a world scale domestic market by opening its economy to upgrade itself. Both aspects of globalization require an active interaction with industrialized societies and multinational corporations.

India’s experiment with hybrid markets may have created a structural impediment to change. To unleash the potential, the country has to strive to develop a shared mindset and agenda, target some industries for special support, focus on quality as a national priority, allow mergers and acquisitions, allow Indian firms to invest in building , marketing and service infrasture in selected markets, focus on Industrial infrasture accelerate the privatization of the public sector, and pay attention to the political process in industrialized societies. For India to step up growth rates and address problems of poverty and unemployment there has to be strategy and vision. Globalization brings a variety of change, presenting opportunities as well as challenges both in economics and financial systems throughout the world. One fact is quite clear, the undeniable benefits of globalization are only available to the countries that best manage their economies.