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Presented By:- Avayant Kumar Singh

Girish Singh
~:GLOBLISATION:~

 Globalization is a process of interaction and


integration among the people, companies and
government of different nation.

 A process driven by international data &


investment and aided by information technology.

 INDIA/CHINA are the major part of globlization.


Globalisation
Factor which affects the globalization:
An economic phenomenon?
A social phenomenon?
A cultural phenomenon?
A political phenomenon?
The movement towards the expansion of
economic and social ties between countries
through the spread of corporate institutions and
the capitalist philosophy that leads to the
shrinking of the world in economic terms.
Process of Globalization
• First Phase Of Globalisation: Back in
Fifteenth century when King Henry the VII
for protecting the maritine interest of the
Empire.
• Capturing Foreign Land led to pre
Capitalist accumulation of Capital through
trade and commerce
Second Phase
 India became Free.
 Conference held at Bretton Wood to
rebuild the international economic
system.
 IBRD(International Bank for
reconstruction and Development)
and IMF set up.
 Gold became a floating asset.
Third Phase
• WTO created in the Post Bretton Wood
Phase of Globalization.
• Focused on removing barrier to free trade
in goods,services and information
amongst countries across the world.
• India integrated with the Global Capitalist
Economies.
Benefits of Globalisation
 World Development
 Access to new markets and new
Technology
 Replacement of Import-Substitution
by export promotion.
 Integration of Economies
 Labour abundance benefits
 Cost reduction benefits
Cont……..
• Improvement in Competitive strength
• Growth and Expansion
• Improvement in standard of living
Introduction of porter’s diamond
model
It analyze why particular industry becomes
competitive in particular locations.

Determining factors of national advantage has


become known as “National Diamond model”.

It suggests that national home base of an


organization plays an important role in shaping
the extent to which it is likely to achieve
advantage on a global scale.
A competitive firm can choose from a number of
trade, contractual, and investment modes of
foreign market entry

Porter introduced a model – the diamond model


•Focuses on 4 central aspects of the home
base-
Factor conditions
Demand conditions
Related & supporting industries
Firm strategy, structure, & rivalry
Porter diamond interactions
Integration of Economies
• The increasing reliance
of economies on each
other
• The opportunities to be
able to buy and sell in
any country in the world
• The opportunities for
labour and capital to
locate anywhere in the
world
Stock Markets are now accessible • The growth of global
from anywhere in the world! markets in finance
Integration of Economies
Made possible by:
Technology
Communication networks
Internet access
Collapse of ‘communism’
Movement to free trade
Liberalization
• Adopted on June 21,1991 by PM Mr. P.V.
Narasimha Rao.
• Government announced the industrial Policy
on July 24, 1991.
• National goals being promotion of heavy and
basic industries.
• Large firms have to obtain clearance under
MRTP Act.
• Foreign companies regulated by FERA 1973
Major Features of Liberalization
policy
 Monetary policy
 Fiscal Policy
 Price Policy
 Trade Policy
 Industrial Policy
 Foreign Investment Policy
 Public Sector Policy
Corporate Expansion
Multi-national
or trans-national
corporations (MNCs or
TNCs) – businesses
with
a headquarters
in one country but
with business
operations in a
number of others.

No matter where you go in the world, certain


businesses will always have a presence.
Corporate Expansion
Characteristics:
 Expanding revenue

 Lowering costs

 Sourcing raw materials

 Controlling key
supplies
Controlling supplies may be one reason
for global expansion.
 Control of processing
Corporate Domination
 Key Issues:
 Damage to the
environment?
 Exploitation of labour?
 Monopoly power
 Economic degradation
 Non-renewable
resources
 Damage to cultures
Other Issues:~
Accountability
of Global businesses?

Increased gap between rich and


poor fuels potential terrorist
reaction

Ethical responsibility of business?

Efforts to remove trade barriers


Thank u