Advantages of globalisation
Advantages of Globalization are as follows:-
- Goods and people are transported with more easiness and speed
- the possibility of war between the developed countries decreases
- free trade between countries increases
- global mass media connects all the people in the world
- as the cultural barriers reduce, the global village dream becomes more realistic
- there is a propagation of democratic ideals
- the interdependence of the nation-states increases
- the flexibility of corporations to operate across borders increases
- the communication between the individuals and corporations in the world increases
- environmental protection in developed countries increases
- Increased liquidity of capital allowing investors in developed nations to invest in developing nations
- Corporations have greater flexibility to operate across borders
- Increased flow of communications allows vital information to be shared between individuals and corporations around the world
- Spread of democratic ideals to developed nations
- Greater interdependence of nation-states
- Reduction of likelihood of war between developed nations
- Workers in less developed countries should see an increase in wages and living benefits. If they do, their rising standard of living should help them consume products from developed nations. A virtuous circle can theoretically be created by a whole new middle class that didn’t exist.
- Peace should be easier to maintain between nations as no country would remain isolated in this new world order. The relationship of China and the United States has changed dramatically as their trade partner status has increased over the years.
- Globalization can help modernize developing countries faster. Modern ideas can be spread to the workers, who make up the social order.
- Products can be purchased much cheaper in developing countries, which increases the lifestyle of the people. As we pay less for simple common items, we have more to spend on big ticket items, which fuel higher paid manufacturing jobs in developed countries.
Advantages of globalization in the developing world
It is claimed that globalization increases the economic prosperity and opportunity in the developing world. The civil liberties are enhanced and there is a more efficient use of resources. All the countries involved in the free trade are at a profit. As a result, there are lower prices, more employment and a better standard of life in these developing nations. It is feared that some developing regions progress at the expense of other developed regions. However, such doubts are futile as globalization is a positive-sum chance in which the skills and technologies enable to increase the living standards throughout the world. Liberals look at globalization as an efficient tool to eliminate penury and allow the poor people a firm foothold in the global economy. In two decades from 1981 to 2001, the number of people surviving on $1 or less per day decreased from 1.5 billion to 1.1 billion. Simultaneously, the world population also increased. Thus, the percentage of such people decreased from 40% to 20% in such developing countries.
Disadvantages of globalisation
Disadvantages of globalisation are as follows:-
- Increased flow of skilled and non-skilled jobs from developed to developing nations as corporations seek out the cheapest labor
- Increased likelihood of economic disruptions in one nation effecting all nations
- Corporate influence of nation-states far exceeds that of civil society organizations and average individuals
- Threat that control of world media by a handful of corporations will limit cultural expression
- Greater chance of reactions for globalization being violent in an attempt to preserve cultural heritage
- Greater risk of diseases being transported unintentionally between nations
- Spread of a materialistic lifestyle and attitude that sees consumption as the path to prosperity
- International bodies like the World Trade Organization infringe on national and individual sovereignty
- Increase in the chances of civil war within developing countries and open war between developing countries as they vie for resources
- Decreases in environmental integrity as polluting corporations take advantage of weak regulatory rules in developing countries.
- Globalization is causing Europeans to lose their jobs as work is being outsourced to the Asian countries. The cost of labor in the Asian countries is low as compared to other countries.
- The high rate of profit for the companies, in Asia, has resulted in a pressure on the employed Europeans, who are always under the threat of the business being outsourced.
- Companies are as opening their counterparts in other countries. This results in transferring the quality of their product to other countries, thereby increasing the chances of depreciation in terms of quality.
- There are experts who believe that globalization is the cause for the invasion of communicable diseases and social degeneration in countries.
- The threat that the corporates would rule the world is on high, as there is a lot of money invested by them.
- It is often argued that poor countries are exploited by the richer countries where the work force is taken advantage of and low wages are implemented.
- For developed economies, globalization means a loss of higher paying jobs as companies seek the cheapest skilled labor at the lowest cost.
- The threat of jobs being offshored is enough to keep morale low in many industries. People who are walking on pins and needles because of the threat their job will be moved to another country are not the most confident consumers around.
- The new workers in new counties may not have the same skill levels as the workers they replaced. In that case, product quality suffers.
- Globalization also represents the transfer of societal ideals to companies who may not be ready for massive changes. In extreme cases, this could result in social instability.
- A real threat exists that workers in less developed countries might be exploited by foreign companies. These companies are attempting to make the maximum profit and probably won’t pay or treat workers as well as they do in their home country.
- Transportation costs become more expensive as products are shipped to countries from much further than they used to be.
- Energy consumption in developing markets increases, which puts pressure on domestic supplies and pricing. Energy costs go up for everyone as more people compete for the resources.
Effect of globalisation on Indian Economy
Effects of Globalization on Indian Industry started when the government opened the country's markets to foreign investments in the early 1990s. Globalization of the Indian Industry took place in its various sectors such as steel, pharmaceutical, petroleum, chemical, textile, cement, retail, and BPO.
Globalization means the dismantling of trade barriers between nations and the integration of the nations economies through financial flow, trade in goods and services, and corporate investments between nations. Globalization has increased across the world in recent years due to the fast progress that has been made in the field of technology especially in communications and transport. The government of India made changes in its economic policy in 1991 by which it allowed direct foreign investments in the country. As a result of this, globalization of the Indian Industry took place on a major scale.
The various beneficial effects of globalization in Indian Industry are that it brought in huge amounts of foreign investments into the industry especially in the BPO, pharmaceutical, petroleum, and manufacturing industries. As huge amounts of foreign direct investments were coming to the Indian Industry, they boosted the Indian economy quite significantly. The benefits of the effects of globalization in the Indian Industry are that many foreign companies set up industries in India, especially in the pharmaceutical, BPO, petroleum, manufacturing, and chemical sectors and this helped to provide employment to many people in the country. This helped reduce the level of unemployment and poverty in the country. Also the benefit of the Effects of Globalization on Indian Industry are that the foreign companies brought in highly advanced technology with them and this helped to make the Indian Industry more technologically advanced.
The various negative Effects of Globalization on Indian Industry are that it increased competition in the Indian market between the foreign companies and domestic companies. With the foreign goods being better than the Indian goods, the consumer preferred to buy the foreign goods. This reduced the amount of profit of the Indian Industry companies. This happened mainly in the pharmaceutical, manufacturing, chemical, and steel industries. The negative Effects of Globalization on Indian Industry are that with the coming of technology the number of labor required decreased and this resulted in many people being removed from their jobs. This happened mainly in the pharmaceutical, chemical, manufacturing, and cement industries.
The effects of globalization on Indian Industry have proved to be positive as well as negative. The government of India must try to make such economic policies with regard to Indian Industry's Globalization that are beneficial and not harmful.
Conclusion
Globalization is such a commonly used term in the twentieth century. It simply means that the world has become integrated economically, socially, politically and culturally through the advances of technology, transportation and communication. It is undeniable to say that globalization has resulted in both positive and negative effects which must be addressed accordingly.
To begin with, globalization has contributed to the world’s economies in many beneficial ways. The advances in science and technology have allowed businesses to easily cross over territorial boundary lines. Consequently, companies tend to become more productive, competitive thereby raising quality of goods, services and the world’s living standard.
As large corporations invest or take over many off shore businesses, a modern form of colonization will also evolve which may pose certain power pressure on the local governments of the less developed countries. Unemployment rates in the more developed regions like Europe may also escalate as corporations choose to outsource cheaper work force from Asian countries.
Globalization brings many benefits and disadvantages to the poor in the world. However, the disadvantages tend to outweigh the benefits on the whole and hence, globalization is definitely not the solution to solve world poverty. Governments of developed nations should actually collaborate to formulate a new policy or strategy which would enable the progress of more developing nations, leaving fewer of such nations behind. However, we must also note that every strategy has its benefits and costs and hence, there are bound to be countries at the losing end.
In conclusion I like to reiterate that globalization is inevitable and we must urge individuals, companies and governments to use a more balanced approach by taking appropriate steps to deal with matters relating to the financial or economical gains verses the social, political or ecological concerns of the world.
Webliography
The above information has been taken from:-
http://business.mapsofindia.com/globalization/india-industry/
http://en.wikipedia.org/wiki/Globalization
=