Evaluate the positive impacts of globalisation on the Indian economy.
The positive impacts of globalisation on the Indian economy are as follows:
- Increased investments in Indian markets by the MNCs have led to the growth of the Indian economy. In many fields such as automobiles, cell phones, soft drinks, fast foods and garments, MNCs have created vast choice of products for the consumers.
- Local companies supplying raw materials to MNCs have developed and prospered. Many Indian companies such as Tata Motors and Ranbaxy themselves have become multinational companies themselves.
- Globalisation has opened many new opportunities for companies in the service sector, especially IT companies. These companies have offered their cheap but efficient consulting services to many nations. This has also created millions of jobs in India.
- Technology has been transferred to developing countries. It has enabled production of quality goods in the international market. During the post reform period, Indian export share in the international market has increased from 0.5% to 1%. Due to the flow of MNCs capital in foreign currency, the availability of foreign exchange increased to a great extent. Foreign investment has increased from US $ 6 billion in 1990-91 to US $ 125 billion in 2004-05.
- Outsourcing is the major outcome of the globalisation process. A company hires regular services mostly from outside the country or within the country like BPO or call centres, banking services, teaching, maintenance of accounts etc. Many multinational corporations are outsourcing their services to India at a cheaper rate with moderate accuracy. In the post reform period, India has provided global outsourcing with the availability of skilled manpower at low wage rates. In India, outsourcing has generated new employment opportunities which lead to a growth in the GDP and also increased the foreign reserve in our economy.
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