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rt) © 447, , <€ Chapter-end, , , , 1. What do you understand by globalisation? Explain in, your own words., , Sol., , The integration of the domestic economy with the world, economy is known as Globalisation. In this process,, goods and services are produced and marketed, throughout the world. Globalisation involves rapid, integration or interconnection between countries., Multinational Corporations (MNCs) set up their, production units and marketing branches in more than, one country. More and more goods, services,, investments and technology move between countries., Countries also get connected by movement of, , people who work in countries other than their own. We, can also say that globalisation is the process by which, the people of the world are unified into a single society, and function together., , 2. What were the reasons for putting barriers to foreign, trade and foreign investment by the Indian Government?, Why have these barriers been removed now?, , Sol., , Barriers to foreign trade and investment were put by the, Indian government to protect domestic producers from, foreign competition, especially when industries had just, begun to come up in the 1950s and 1960s. Postindependence India put barriers on its foreign trade as, the imports had exceeded exports and the country was, in huge debt. To reverse the debt and improve the

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Cr Loe} Cm 2 ey ke |, , , , Chapter-end, , conditions. This will lead to an increase in the, company’s competitiveness., , 4. What are the various ways in which MNCs set-up or, control production in other countries?, , Sol., , The various ways in which MNCs set-up or control, production in other countries are as follows:, , i. They buy a local production company and expand, their operations., , i. They place orders for production with small, producers, i.e. in most cases, they opt for, contract manufacturing. Garments, footwear,, sports items etc are examples of industries, where production is carried out by a large number, of small producers around the world., , iii. By setting up a partnership (joint venture) with a, , local company., , iv. By setting up their wholly owned subsidiary in, another country., , v. By licensing or franchising their brands to a local, , company., , 5. Why developed countries want developing countries, to liberalise their trade and investment? What do you, think should the developing countries demand in return?, , Sol., , Developed countries want developing countries to

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Ma. COM iy ey |, , <€ Chapter-end, , , , 8. How does foreign trade lead to integration of, markets across countries? Explain with an example, other than those given here., , Sol., , Liberalisation of trade and investment policies has, helped the globalisation process by making foreign, trade and investment easier. Earlier, several developing, countries had placed barriers and restrictions on, imports and investments from abroad to protect, domestic production. However, to improve the quality of, domestic goods, these countries have removed the, barriers. Thus, liberalisation has led to a further spread, of globalisation because now businesses are allowed to, make their own decisions on imports and exports. This, has led to a deeper integration of national economies, into one conglomerate whole., , For example, during Diwali seasons, buyers in India, have the option of choosing between Indian and the, Chinese decorative lights and bulbs. Many shops have, replaced Indian decorative lights with Chinese lights., For Chinese light manufacturers, this provides an, opportunity to expand their business., , 9. Globalisation will continue in the future. Can you, imagine what the world would be like twenty years from, now? Give reasons for your answer., , Sol., , After 20 years, the world would undergo a positive, , channa with tha faaturac af haalthy camnetitian

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Ma. COM iy ey |, , <€ Chapter-end, , , , 9. Globalisation will continue in the future. Can you, imagine what the world would be like twenty years from, now? Give reasons for your answer., , Sol., , After 20 years, the world would undergo a positive, change with the features of healthy competition,, improved production efficiency, increased volume of, output, income and employment, better living standards,, greater availability of information and modern, technology. The entire world would become a global, village twenty years right from now. The reasons are, mentioned below:, , . Human resources, both quantity wise and quality, wise will be available globally., , i. More and more goods and services, investment, and technology would shuffle between countries., , iii. All major countries will have a broad resource, , and industrial base., iv. Entrepreneurship will grow., , v. Domestic markets of all major countries will, experience growth., MNCs would produce goods and services in, those locations around the world which would be, , cheaper for their production., , vi., , 10. Supposing you find two people arguing: One is, saying globalisation has hurt our country’s, development. The other is telling, globalisation is, helping India develop. How would you respond to these

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Ma. COM iy ey |, , Chapter-end, , , , Globalisation and greater competition among, producers-both local and foreign producers have, been of advantage to consumers, particularly the, well-off sections in the urban areas. There is, , a greater choice before these consumers who, now enjoy the improved quality and lower prices, for several products. As a result, these people, today, enjoy much higher standards of living than, was possible earlier., , iv. Government has also allowed flexibility in the, labour laws to attract foreign investment. Instead, of hiring workers on a regular basis, companies, hire workers ‘flexibly’ for short periods when, there is intense pressure of work. This is done to, reduce the cost of labour for the company., , 7. How has liberalisation of trade and investment, policies helped the globalisation process?, , Sol., , Liberalisation barriers on foreign trade and foreign, investment have been removed to a great extent. This, has helped in the import and export of goods. This, means that goods can be exported and imported easily, and also foreign companies could set up factories and, offices here., , Larger foreign investment and larger foreign trade have, led to greater integration of production and markets, across countries. As a result, more and more, companies are coming closer to each other due to, MNCs. Thus, the liberalisation of trade and investment, policies has helped the globalisation process.