NCERT Class 10 Economics Chapter 4: Globalization & Indian Economy YouTube Lecture Handouts
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NCERT Class 10 Economics Chapter 4: Globalization & Indian Economy
Chapter 4: Globalization & Indian Economy
MNCs
- Owns or controls production in more than one nation (cheap labor & resource, low cost, more profit)
- NOT selling globally but producing globally (complex way)
- Cheap production β China
- Closeness to market β Mexico & Eastern Europe
- Skilled Engineers β India
- English speaking β Customer care
- Favorable govt. policies
- Save 50 - 60% cost of MNC
Interlinking Production
- Investment β money to buy land, machine & building
- Foreign Investment β made by MNC β to earn profit
- MNC brings latest technology for production
- MNC provides money for investment (huge wealth)
- Cargill foods bought Indian Parakh foods β now Cargill (largest edible oil producer in India with 5 million pouches daily)
- MNC place order with small producers β garment, footwear β determine price, quality, delivery, and labor conditions
- With dispersed production locations are interlinked
Foreign Trade
- Producer reach beyond domestic market
- Buyers expand choice of goods beyond what is produced domestically
- Chinese toys in India β cheaper, competitive, replaced Indian market
- Choice for goods arises β price stabilizes
- It connects and integrates market.
Globalization
- Ford β manufactures for India and exports
- More trade + more investment + more integration or interconnection
- What moves? Goods, services, investment & technology
- Why people move? Job, education & income
Globalization
- Interdependence of worldΥs economies
- Globalization + Connectivity & Digitization = Innovation & Value Creation
- Prior β Trade (export of raw material & import of finished product)
Technology β Enabled Globalization
- Containers for transport
- Movement of goods and services
- ICT β telecom, computers, internet (e-mail or voice talk β negligible cost) , satellite devices
- Payment wallets and e-banking (upcoming)
Liberalization
- What if taxes on import of toys from China?
- Trade barrier β taxes on import β govt. use to foreign trade
- Quota β limit number of goods imported
- India had trade restrictions till 1950 - 60s to protect local artisans
- Only essential item imports were allowed (fertilizer, petroleum)
- 1991- policy changes β LPG β compete globally to improve performance
- No barrier on foreign trade β easy imports and exports β removing barriers - liberalization
WTO
- Free trade and liberalize trade β WTO
- Formed - 1st Jan 1955
- Headquarters β Geneva, Switzerland
- Members β 164 states
- Under Marakkesh Agreement β replaced GATT (General Agreement on Tariffs & Trade)
- Focus on Doha rounds β for developing nations
- Developed nations β unfairly retained trade barriers
- Forced developing nations to remove trade barriers (US farmers paid huge sum of money by govt. β bring in cheap produce & is unfair)
Impact on India
- Customers β Greater choice, improved quality & low price
- Investment of MNCs increased β cell phone, automobile, electronics
- Creation of new jobs
- SEZs β with world class facilities to attract investors
- Flexibility in labor laws β hire for short period when more work pressure
- Investment in new technology and higher production standards
- Indian companies as MNCs - Tata Motors (automobiles) , Infosys (IT) , Ranbaxy (medicines) , Asian Paints (paints) , Sundaram Fasteners (nuts & bolts)
- Host of services like data entry, accounting, administrative tasks, engineering
Negative Impact on India
- Lesser job security
- Workers employed flexibly
- Long work hours & night shifts
What is the AIM?
- Fair globalization β opportunity for all
- Proper implementation of labor laws
β Manishika