What is globalisation? Explain its good effects on the Indian economy.

Globalisation is the interconnection between counties through the expansion of foreign trade and foreign investment. It is the process of integrating the home country with foreign countries through the movement of goods, services, investment, technology, and people. India has been a globalised economy since 1991 after the country faced an economic crisis in the pre-1991 period. After this 27 years of globalisation, the economy has experienced both ups and downs because of this increased integration of the country with other countries.

Some of the advantages that are the result of globalisation are:

• Production of standardised, high quality products and services: Globalisation has resulted in greater competition among the producers. Producers in the home countries compete with the foreign producers and products thus improving the quality of the goods and services produced. This greater competition has resulted in the improved standards of the products produced at a lower price. This increased quality of products at lower prices has raised their standard of living significantly.

• The improved choice for buyers: MNCs are investing immensely in sectors like automobiles, communications and other industries. This has improved the choices of buyers. Consumers also have the choice to select commodities produced beyond the domestic markets through international trade.

• Increased employment opportunities: Globalisation always brings in the bulk of employment opportunities. MNCs will require qualified and professional employees for the management of their regional offices. It will also increase employment in allied sectors like transportation, IT and other industries. They will also generate a lot of other jobs in sectors like footwear and garments when they place orders for the products with the local industries. This increases the employment opportunities for both skilled and unskilled labour.

• Additional investment: Globalisation beneficial as the huge MNCs with many resources will bring in their additional share of investment. This is particularly beneficial to the local firms in a developing country like India that has scarcity in resources. This will increase the quantity of resources available to local firms to expand their production.