Structure of the Economy:
Due to globalization not only the GDP has increased but also the direction of growth in the sectors has also been changed. Earlier the maximum part of the GDP in the economy was generated from the
primary sector but now the service industry is devoting the maximum part of the GDP. The services sector remains the growth driver of the economy with a contribution of more than 57 per cent of GDP.
India is ranked 18th among the world’s leading exporters of services with a share of 1.3 per cent in world exports. The services sector is expected to benefit from the ongoing liberalization of the foreign
investment regime into the sector. Software and the ITES-BPO sectors have recorded an exponential growth in recent years. Growth rate in the GDP from major sectors of the economy can be seen from
the following Table.
ECONOMIC GLOBALISATION VERSUS TECHNOLOGY:
Globalisation has placed challenges on the human lifestyle and economic development all over the world. As pointed out by Badran, human development will be essential to accelerate science and technology for sustainable development [2]. Technology is the key variable in the economic development of any country. Technological progress and economic development are interdependent. The contrast lies in the different standards of living between highly developed nations, such as the USA, and underdeveloped nations, such as Haiti or
Zaire, and is a reflection of the levels of different technologies and the effectiveness and the essential services provided by engineers to society.
GLOBALIZATION ON INDIAN ECONOMY :
If we look at the past thirty years or so, we find that MNCs have been a major force in the globalisation process connecting distant regions
of the world. Why are the MNCs spreading their production to other countries and what are the ways in which they are doing so? The first part of the chapter discusses this. Rather than relying on quantitative estimates, the rapid rise and influence of the MNCs has been shown
through a variety of examples, mainly drawn from the Indian context. Note that the examples are an aid to explain a more general point. While teaching, the emphasis should be on the ideas and examples are to be used as illustrations. You can also creatively use comprehension
passages like the one given after Section II to test and reinforce new concepts. Integration of production and integration of markets is a key idea behind understanding the process of globalisation and its impact. This has been dealt with at length in this chapter, highlighting the role of MNCs in the process. You have to ensure that the students grasp this idea with sufficient clarity, before moving on to the next topic. Globalisation has been facilitated by several factors. Three of these have been highlighted: rapid improvements in technology, liberalisation.
Abstract :
The growing integration of economies and societies around the world – has been one of the most hotly-debated topics in international economics over the past few years. Rapid growth and poverty reduction in China, India, and other countries that were poor 20 years ago, has been a positive aspect of Liberalization Privatization and Globalization (LPG). But Globalization has also generated significant international opposition over concerns that it has increased inequality and environmental degradation. There is a need to study the impact of globalization on developing countries from the viewpoint of inward foreign direct investment. Attention should also be focused on the role which some developing countries, particularly from parts of Asia and Latin America, are playing as initiators of globalization through their own MNCs. India opened up the economy in the early nineties following a major crisis that led by a foreign exchange crunch that dragged the economy close to defaulting on loans. The response was a slew of Domestic and external sector policy measures partly prompted by the immediate needs and partly by the demand of the multilateral organisations. The new policy regime radically pushed forward in favour of a more open and market oriented economy. This paper explores the contours of the on-going process of globalization Liberalization and privatization. Throughout, there is an underlying focus on the impact of LPG on Indian economy. It also comments on impact of LPG on Developing countries.