What are distinctive features of a globalised economy? Discuss.
The Distinctive Features of a Global Economy:
(i) Globalisation refers to the growing interdependence between different peoples, regions and countries in the world as social and economic relationship come to stretch world-wide.
(ii) Although economic forces are on integral part of globalisation, it would be wrong to suggest that they alone produce it.
(iii) It has been driven forward above all by the development of information and communication technologies that have intensified the speed and scope of interaction between people all over the world.
(iv) In India the state decided to bring several changes in its economic policy in 1991. These changes are termed as liberalisation policies. Since then globalisation involves a stretching of social and economic relationship throughout the world. This stretching is pushed by certain economic policies very broadly this process in India is termed liberalisation. The term liberalisation refers to policy of decisions that the Indian state took since 1991 to open up the Indian economy to the world market. This market a break with an earlier stated policy of the government to have a greater control over the economy.
(v) Liberalisation of the economy meant the steady removal of the rules that regulated Indian trade and finance regulations. These measures are also described as economic reforms.
(vi) Since July 1991, the Indian economy has witnessed a series of reforms has in all major sectors of the economy (agriculture, industry, trade, foreign investment and and technology, public sector, financial institutions, etc.). The basic assumption was that greater integration into the global market would be beneficial to Indian economy.
(vii) The process of liberalisation also involved the taking of loans from international institutions such as International Monetary Fund (IMF). These loans are given on certain conditions. The government marks commitments to persue certain kind of economic measures that involve a policy of structural adjustments. These adjustments usually mean cuts two states expenditure on the social sector such as health, education and social security. There is also a greater lay by international institutions such as the World Trade Organisation (WTO).
(viii) Among the many economic factors during globalisation, the role of transnational corporations (TNCs) is particularly important. TNCs are countries that produce goods or market services in more than one country. Some Indian corporations are also becoming transnational.
