1. Globalization and the Indian Economy c) What is Globalization? Definition: The rapid integration or interconnection between countries. It is the process of rapid integration and interconnection between countries. MNCs are key drivers of globalization. Involves increased flow of goods, services, investments, technology, and people between countries. The world is becoming more interconnected, leading to greater interdependence. d) Factors that Have Enabled Globalization Technology: Rapid improvements in transportation: Made much faster delivery of goods across long distances possible at lower costs. For example, container shipping has drastically reduced ocean freight costs and improved efficiency. Information and Communication Technology (ICT): Telecommunications (telephones, mobile phones, fax) have made it possible to contact one another across the world instantly. The Internet and email provide access to an electronic network of information and communication at negligible cost. These advancements have facilitated the spread of services like call centers and data entry across the globe. Liberalization of Foreign Trade & Investment Policy: Trade Barriers: Restrictions on imports (e.g., taxes on imported goods) used by governments to regulate foreign trade and protect domestic producers from foreign competition. Historically, India used these barriers after independence. Liberalization: The policy of removing or reducing these barriers or restrictions set by the government. With liberalization, goods can be imported and exported freely. Foreign companies can also set up factories and offices in the country. India adopted this policy around 1991, opening its markets to foreign trade and investment.
