Globalization

Group 10

What is Globalization?

Stephen Gill defines globalisation as the reduction of transaction cost of transborder movements of capital and goods thus of factors of production and goods.

CHARACTERISTICS Growing worldwide interconnection Rapid, Discontinuous change Increased number and Diversity of participant Growing complexity

Causes of globalization Improvement of transport.

Establishment of international organizations

Globalization Development of communication

Emergence of global problems Rise of transnational corporations

Globalizat ion Economic

Flow of commodities

Division of production process

Flow of capital

Cultural

Flow of people

Flow of communities

GLOBALIZATION OF CULTURE

GLOBALIZATION OF POLITICAL ENVIRONMENT

GLOBALIZATION OF ECONOMICS

GLOBALIZATION OF TECHNNOLOGIES

GLOBALISATION OF AGRICULTURE

ESSENTIAL CONDITION FOR GLOBALIZATION Business Freedom Facilities Government Support Resources Competitiveness

Key Public Policies Of RBI 1. The government is gradual rebalancing between public and private ownership. Higher Market Orientation is key 4. Significant liberalization of external trade

Key Public Policies Of RBI 5 Privatization of power, airports and seaports which has significant employment potential 6 Improvement in both productivity and output in the agriculture 7 Improvements in institutional infrastructure in matters relating to administrative, judicial and other systems of governance are important.

Indian Economy Scrapping of the industrial licensing regime Reduction in the number of areas reserved for the public sector, Start of the privatisation programme reduction in tariff rates and Change over to market determined exchange rates.

Indian Economy •The Indian tariff rates reduced a weighted average of 72.5% in 1991-92 to 24.6 in 1996-97 . •Tariff rates went up slowly in the late nineties it touched 35.1% •Peak tariff rates reduced to the minimum with a rate of 20% • Most non-tariff barriers have been dismantled by March 2002,

Export and Import India’s Export $ 32.5 bn before 1991 and In 2005 $129.2 bn Forex reserves Agriculture exports account for about 13 to 18% of total annual export of the country. In 2000-01 Agricultural products valued at more than US $ 6million Marine products in recent years is contributing for over one fifth of the total agricultural exports. Cereals, oil seeds, tea and coffee nearly 5 to 10% of the countries total exports.

India’s position in the global economy has improved from the 8th position in 1991 to 4th place in 2001 (PPP basis) GDP- 5.6% in 1990-91 to a peak level of 7.78% in 1996-97. Growth rate now at around 6.5%, expected to go up to 7% India is now the fastest growing just after China.

OBSTACLE Poor Infrastructure High Cost Government Policy & Procedures Resistance to Change Poor quality image Supply problem Small Size Limited R&D and marketing Research Growing competition Trade Barriers

The Opportunity India has ample opportunities to develop its financial system further. The current round of reforms, which allow pension funds to invest more in equities, will help spur market growth, as will the continued privatization of state-owned enterprises. Opening more parts of the economy to investment from foreign corporations and from expatriates India has made remarkable economic progress since opening its economy in 1991. To continue that growth, it must now focus on developing its financial system

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