GLOBALIZATION, GLOBALIZATIONAND ITS IMPACT, DEFINITION OF GLOBALIZATION, GLOBALIZATION IN ECONOMY, HISTORY OF GLOBALIZATION, TYPES OF GLOBALIZATION, IMPACT OF GLOBALIZATION.

1. GLOBALIZATION
AND ITS IMPACT
PR E S E N T E D BY -
D H RU V I
P O O J A
K R I YA

2. GLOBALIZATION
D E F I N I T I O N

3. DEFINITION OF GLOBALIZATION
• Globalization means the speedup of movements and
exchanges (of human beings, goods, and services,
capital, technologies or cultural practices) all over the
planet. One of the effects of globalization is that it
promotes and increases interactions between different
regions and populations around the globe.
• The increased interconnectedness and
interdependence of peoples and countries. It is
generally understood to include two inter-related
elements: the opening of international borders to
increasingly fast flows of goods, services, finance,
people and ideas; and the changes in institutions and
policies at national and international levels that
facilitate or promote such flows.

4. GLOBALIZATION IN ECONOMY
 The increasing interdependence of world
economies as a result of the growing scale of
cross-border trade of commodities and services,
the flow of international capital and the wide
and rapid spread of technologies.
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5. HISTORY OF GLOBALIZATION
 It was particularly after the second half of the
20th century that world trades accelerated in
such a dimension and speed that the term
“globalization” started to be commonly used.
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6. TYPES OF GLOBALIZATION
• Economic globalization
• Financial globalization
• Cultural globalization
• Political globalization
• Sociological globalization
• Technological globalization
• Geographic globalization
• Ecological globalization

7. IMPACT OF
GLOBALIZATION

8. IMPACT OF GLOBALIZATION
On Agriculture Sector
i. Agricultural Sector is the mainstay of the rural Indian
economy around which socio-economic privileges
and deprivations revolve and any change in its
structure is likely to have a corresponding impact on
the existing pattern of Social equity.
ii. Facing a severe economic crisis, India approached the
IMF for a loan, and the IMF granted what is called a
‘structural adjustment’ loan, which is a loan with
certain conditions attached which relate to a
structural change in the economy.
iii. Essentially, the reforms sought to gradually phase
out government control of the market
(liberalization), privatize public sector organizations
(privatization), and reduce export subsidies and
import barriers to enable free trade (globalization).

9. IMPACT OF GLOBALIZATION
on Industrial Sector
I. The government of India made changes in its economic policy in 1991 by
which it allowed direct foreign investments in the country.
II. The benefits of the effects of globalization in the Indian Industry are that
many foreign companies set up industries in India, especially in the
pharmaceutical, BPO, petroleum, manufacturing, and chemical sectors and
this helped to provide employment to many people in the country.
III. This helped reduce the level of unemployment and poverty in the country.
Also the benefit of the Effects of Globalization on Indian Industry are that
the foreign companies brought in highly advanced technology with them
and this helped to make the Indian Industry more technologically
advanced.
IV. The negative Effects of Globalization on Indian Industry are that with the
coming of technology the number of labor required decreased and this
resulted in many people being removed from their jobs. This happened
mainly in the pharmaceutical, chemical, manufacturing, and cement
industries.

10. IMPACT OF GLOBALIZATION
on Financial Sector
i. Financial intermediaries have come out of their
traditional approach and they are ready to assume
more credit risks. As a consequence, many
innovations have taken place in the global financial
sectors which have its own impact on the domestic
sector also.
ii. Growth in financial services (comprising banking,
insurance, real estate and business services), after
dipping to 5.6% in 2003-04 bounced back to 8.7% in
2004-05 and 10.9% in 2005-06. The momentum has
been maintained with a growth of 11.1% in 2006-07.
Because of Globalization, the financial services
industry is in a period of transition. Market shifts,
competition, and technological developments are
ushering in unprecedented changes in the global
financial services industry.

11. IMPACT OF GLOBALIZATION
on Financial Sector
A. THE CHALLENGES OF FINANCIAL SERVICE
SECTOR
Among the key IT challenges facing the Financial
Services Industry to day is:
i. Preserving investments in old systems while
leveraging new technologies to drive down
transactions costs, expand and improve customer
service.
ii. Integrating enterprise wide disparate systems to
gain operation efficiencies
iii. Substantially reducing time for deployment of new
systems
iv. Reducing IT costs and obtaining better ROIs for
new investments in the long-term

12. STRATEGIES TO BE ADOPTED BY FSS
The Government of India has initiated many steps to
reform the financial services industry.
The Government has already switched over to free pricing
of issues from pricing issues by the Controller of Capital
Issues.
The interest rates have been deregulated
 The private sector has been permitted to participate in
banking and mutual funds and the public sector undertaking
are being privatized.
 The Finance Act, 1992 has brought into effect large scale
amendments in the tax structure of long term capital gains.
The Finance Act, 1994 has given a further boost by lowering
the lock-in period from 3years to 1 year, in order to get the
entitlement as a long-term capital asset.

13. INDIA’S STANCE ON FINANCIAL
SERVICE SECTOR
What should be India’s attitude in this
environment of growing globalization? At the
outset it must be mentioned that opting out of
globalization is not a viable choice. There are at
present 1449 members in the World Trader
Organization (WTO). The rest of the countries
are waiting to join the WTO. China has recently
been admitted as a member. What is need is
to evolve an appropriate framework to wrest
maximum benefits out of international trade and
investment. This framework should include
(a) making explicit the list of demands that India
would like to make on the multilateral trade
system, and (b) steps that India should take to
realize the full potential from globalization.

14. ADVANTAGES OF
GLOBALIZATION

15. ADVANTAGES OF GLOBALIZATION
• Increased free trade between nations.
• Increased liquidity of capital allowing
investors in developed nations to invest in
developing nations.
• Corporations have greater flexibility to
operate across borders.
• Global mass media ties the world
together.
• Increased flow of communications allows
vital information to be shared between
individuals and corporations around the
world.

16. ADVANTAGES OF GLOBALIZATION
• Greater ease and speed of transportation
for goods and people.
• Reduction of cultural barriers increases
the global village effect.
• Spread of democratic ideals to developed
nations.
• Greater interdependence of nation-states.
• Reduction of likelihood of war between
developed nations.
• Increases in environmental protection in
developed nations.

17. DISADVANTAGES OF
GLOBALIZATION

18. DISADVANTAGES OF GLOBALIZATION
• Spread of a materialistic lifestyle and attitude
that sees consumption as the path to
prosperity.
• International bodies like the World Trade
Organization infringe on national and
individual sovereignty.
• Increase in the chances of civil war within
developing countries and open war between
developing countries as they vie for resources.
• Decreases in environmental integrity as
polluting corporations take advantage of weak
regulatory rules in developing countries.

19. DISADVANTAGES OF GLOBALIZATION
• Increased flow of skilled and non-skilled jobs
from developed to developing nations as
corporations seek out the cheapest labor.
• Increased likelihood of economic disruptions in
one nation effecting all nations.
• Corporate influence of nation-states far exceeds
that of civil society organizations and average
individuals.
• Threat that control of world media by a handful
of corporations will limit cultural expression.
• Greater chance of reactions for globalization
being violent to preserve cultural heritage.
• Greater risk of diseases being transported
unintentionally between nations.

20. GLOBALIZATIONIN
INDIA
C O M PA R I S I O N W I T H O T H E R C O U N T R I E S

21. GLOBALIZATION IN INDIA
• Developed countries had been trying to
pursue developing countries to liberalize
the trade and allow more flexibility in
business policies to provide equal
opportunities to multinational firms in
their domestic market.
• Indian government did the same and
liberalized the trade and investment due
to the pressure from World Trade
Organization.

22. GLOBALIZATION IN INDIA
• As a result globalization has brought to
India new technologies, new products and
also the economic opportunities.
• Despite bureaucracy, lack of infrastructure,
and an ambiguous policy framework that
adversely impact MNCs operating in India,
MNCs are looking at India in a big way, and
are making huge investments to set up R&D
centers in the country. India has made a
lead over other growing economies for IT,
business processing, and R&D investments.

23. IMPACT OF
GLOBALIZATIONIN INDIA

24. IMPACT OF GLOBALIZATION IN INDIA
Economic Impact:
 Greater Number of Jobs
 More choice to consumers
 Higher Disposable Incomes
 Shrinking Agricultural Sector
 Increasing Health-Care costs
 Child Labour
•

25. IMPACT OF GLOBALIZATION IN INDIA
• Consider global trade – India’s share of world
merchandise exports increased from .05% to
.07% over the past 20 years. Over the same
period China’s share has tripled to almost
4%.
• India’s share of global trade is similar to that
of the Philippines an economy 6 times
smaller according to IMF estimates.
Over the past decade FDI flows into India
have averaged around 0.5% of GDP against
5% for China and 5.5% for Brazil. FDI
inflows to China now exceed US $ 50 billion
annually. It is only US $ 4billion in the case
of India.

26. IMPACT OF GLOBALIZATION IN INDIA
Socio-Cultural Impact on Indian Society
 Access to education
 Growth of cities
 Indian Culture
Psychological Impact on Indian Society
 Development of Bicultural
Identity
 Growth of Self-Selected Culture
 Consumerism

27. CONCLUSION

28. CONCLUSION
• Globalization is not guilty of causing growing
poverty and inequality worldwide.
• Overall, there has been declining inequality and
poverty in the age of globalization. This breaks a
trend that goes back almost two centuries
• But far too many countries have become less
globalized and grown poorly.
• This is the only sense in which globalization
causes inequality: some seize opportunities and
others do not
• The challenge is to help the failures do better.

29. THANK YOU!