A abampere (aA) The unit of electric current in the CGSeniu system, defined as that current that, if flowing through two parallel conductors of negligible cross section and infinite length, placed 1 cm apart in vacuo, would produce on each conductor a force of 1 dyne per centimeter of length. 1 abampere = 1 abcoulomb/s = r statampere (where c = speed of light in cm/s) = 10 ampere. aberration Imperfect image formation due to geometric imperfections in the optical elements of a system ablation 1 . The wasting of glacier ice by any process (calving, melting, evaporation, etc.). 2. The shedding of molten material from the outer sur- face of a meteorite or tektite during its flight through the atmosphere. absolute age The age of a natural substance, of a fossil or living organism, or of an artifact, obtained by means of an absolute dating method. See absolute dating method. absolute density Density in kg/m' or, more commonly, in g/cm\ both at STP. Cf. density, relative density abso
Globalization and the Indian Economy class 10 Economics NCERT MCQ & SAQ
Globalization and the Indian Economy class 10 Economics NCERT solution:
1. What do you understand about globalization? Explain in your own words.
Globalization means integrating the economy of a country with the economies of other countries under conditions of free flow of trade, capital and movement of persons across borders. It includes
(i) Increase in foreign trade
(ii) Export and import of techniques of production.
(iii) Flow of capital and finance from one country to another
(iv) Migration of people from one country to another.
2. What was the reason for putting barriers to foreign trade and foreign investment by the Indian government? Why did it wish to remove these barriers?
The Indian government had put barriers to foreign trade and foreign investment to protect domestic producers from foreign competition, especially when industries had just begun to come up in the 1950s and 1960s. At this time, competition from imports would have been a death blow to growing industries. Hence, India allowed imports of only essential goods.
In New Economic Policy in 1991, the government wished to remove these barriers because it felt that domestic producers were ready to compete with foreign industries. It felt that foreign competition would in fact improve the quality of goods produced by Indian industries. This decision was also supported by powerful international organizations.
3. How would flexibility in labor laws help companies?
Flexibility in labor laws will help companies in being competitive and progressive. By easing up on labor laws, company heads can negotiate wages and terminate employment, depending on market conditions. This will lead to an increase in the company's competitiveness.
4. What are the various ways in which MNCs set up, or control, production in other countries?
Answer
Multinational Corporations (MNCs) set up their factories or production units close to markets where they can get desired type of skilled or unskilled labor at low costs along with other factors of production. After ensuring these conditions MNCs set up production units in the following ways :
→ Jointly with some local companies of the existing country.
→ Buy the local companies and then expand their production with the help of modern technology.
→ They place orders for small producers and sell these products under their own brand name to the customers worldwide.
5. Why do developed countries want developing countries to liberalize their trade and investment? What do you think the developing countries should demand in return?
Developed countries want developing countries to liberalize their trade and investment because then the MNCs belonging to the developed countries can set up factories in less-expensive developing nations, and thereby increase profits, with lower manufacturing costs and the same sale price.
In my opinion, the developing countries should demand, in return, for some manner of protection of domestic producers against competition from imports. Also, charges should be levied on MNCs looking to set bases in developing nations.
6. "The impact of globalization has not been uniform." Explain this statement.
Answer
"The impact of globalization has not been uniform". It has only benefitted skilled and professional people in urban areas, not unskilled persons. The industrial and service sector has gained much more in globalization than in agriculture. It benefitted MNCs on domestic producers and the industrial working class. Small producers of goods such as batteries, capacitors, plastics, toys, tyres, dairy products and vegetable oil have been hit hard by competition from cheaper imports.
7. How has liberalization of trade and investment policies helped the globalization process?
Answer
Liberalization of trade and investment policies has helped the globalization process by making foreign trade and investment easier. Earlier, several developing countries had placed barriers and restrictions on imports and investments from abroad to protect domestic production. However, to improve the quality of domestic goods, these countries have removed the barriers. Thus, liberalization has led to a further spread of globalization because now businesses are allowed to make their own decisions on imports and exports. This has led to a deeper integration of national economies into one conglomerate whole.
8. How does foreign trade lead to integration of markets across countries? Explain with an example.
Foreign trade provides opportunities for both producers and buyers to reach beyond the markets of their own countries. Goods travel from one country to another.Competition among producers of various countries as well as buyers prevails. Thus foreign trade leads to integration of markets across countries.
For example, during Diwali season, buyers in India have the option of choosing between Indian and Chinese decorative lights and bulbs. So this provides an opportunity to expand business.
9. Globalization will continue in the future. Can you imagine what the world would be like twenty years from now? Give reasons for your answer.
After twenty years, the world would undergo a positive change which would possess the following features— healthy competition, improved productive efficiency, increased volume of output, income and employment, better living standards, greater availability of information and modern technology.
Reason for the views given above : These are the favorable factors for globalization :
→ Availability of human resources both quantity wise and quality wise.
→ Broad resource and industrial base of major countries.
→ Growing entrepreneurship
→ Growing domestic market.
10. Suppose you find two people arguing: One is saying globalization has hurt our country's development. The other is telling, globalization is helping India develop. How would you respond to these organizations?
Benefits of globalization of India :
→ Increase in the volume of trade in goods and services
→ Inflow of private foreign capital and export orientation of the economy.
→ Increases volume of output, income and employment.
Negative Impact / Fears of Globalization.
→ It may not help in achieving sustainable growth.
→ It may lead to widening income inequalities among various countries.
→ It may lead to aggravation of income inequalities within countries.
Whatever may be the fears of globalization, I feel that it has now become a process which is catching the fancy of more and more nations. Hence we must become ready to accept globalization with grace and also maximize economic gains from the world market.
11. Fill in the blanks.
Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of ______________. Markets in India are selling goods produced in many other countries. This means there is increasing ______________ with other countries. Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because _____________. While consumers have more choices in the market, the effect of rising _______________ and ______________has meant greater ________________among the producers.
Answer
Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of globalization. Markets in India are selling goods produced in many other countries. This means there is increasing trade with other countries. Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because of cheaper production costs. While consumers have more choices in the market, the effect of rising demand and purchasing power has meant greater competition among the producers.
12. Match the following.
Answer
Page No: 73
13. Choose the most appropriate option.
(i) The past two decades of globalization has seen rapid movements in
(a) goods, services and people between countries.
(b) goods, services and investments between countries.
(c) goods, investments and people between countries.
► (b) goods, services and investments between countries.
(ii) The most common route for investments by MNCs in countries around the world is to
(a) set up new factories.
(b) buy existing local companies.
(c) form partnerships with local companies.
► (b) buy existing local companies.
(iii) Globalization has led to improvement in living conditions
(a) of all the people
(b) of people in the developed countries
(c) of workers in the developing countries
(d) none of the above
► (d) none of the above
Globalization and the Indian Economy class 10 Economics NCERT MCQ :
1. Fair globalization refers to ensuring benefits to:
(a) laborers
(b) producers
(c) consumers
(d) all the above
► (d)
2. Globalization has led to improvement in
(a) choice to consumers
(b) quality of goods and services
(c) foreign investment
(d) all the above
► (d)
3. Which sector has not benefited from the policy of globalization?
(a) Agricultural sector
(b) Manufacturing sector
(c) Service sector
(d) All the above
► (a)
4. Globalization results in
(a) lesser competition among producers
(b) greater competition among producers
(c) no change in competition among producers
(d) none of the above
► (b)
5. Cheaper imports, inadequate investment in infrastructure lead to
(a) slowdown in agricultural sector
(b) replace the demand for domestic production
(c) slowdown in industrial sector
(d) all the above
► (d)
6. Which has played a big role in spreading globalization?
(a) Information technology (IT)
(b) Transport technology
(c) Both (a) and (b)
(d) None of the above
► (c)
7. Globalization so far has been more in favor of:
(a) developed countries
(b) developing countries
(c) poor countries
(d) none of the above
► (a)
8. Globalization leads to rapid movements of the following between countries :
(a) goods and services
(b) investments
(c) people
(d) all the above
► (d)
9. Which of the following factors has not facilitated globalization?
(a) Technology
(b) Liberalization of trade
(c) WTO
(d) Nationalization of banks
► (d)
10. When was the WTO established?
(a) 1985
(b) 1995
(c) 2000
(d) 2005
► (b)
11. FDI (Foreign Direct Investment) attracted by globalization in India belongs to the
(a) World Bank
(b) multinationals
(c) foreign governments
(d) none of the above
► (b)
12. Liberalization refers to
(a) freeing the economy from direct control
(b) putting an end to various restrictions
(c) opening up the economy
(d) all the above
► (d)
13. Multinational corporations have succeeded in entering global markets through
(a) WTO
(b) UNO
(c) UNESCO
(d) none of the above
► (a)
14. What attracts an MNC?
(a) Cheap labor
(b) Ready demand for the product
(c) Both (a) and (b)
(d) None of the above
► (c)
15. Investment means spending on
(a) factory building
(b) machines
(c) equipments
(d) all the above
► (d)
16. Globalization results in
(a) inflow of labor from abroad
(b) inflow of capital from abroad
(c) inflow of tourists from abroad
(d) all the above
► (b)
25. Which of the following contributes to globalization?
(a) internal trade
(b) external trade
(c) large scale trade
(d) small scale trade
► (b)
26. Benefits enjoyed by companies who set up production units in the SEZs are:
(a) they do not have to pay taxes for some years
(b) reduction in excise duty
(c) reduced tariffs and barriers
(d) none of the above
► (a)
28. Integration of markets means
(a) operating beyond the domestic markets
(b) wider choice of goods
(c) competitive price
(d) all the above
► (d)
29. Special Economic Zones (SEZ) developed by the Government of India aim
(a) to attract foreign companies to invest in India
(b) to encourage small investors
(c) to encourage regional development
(d) none of the above
► (a)
30. Which one of the following is not true regarding the World Trade Organization?
(a) It allows free trade to all countries without any trade barriers.
(b) Its aim is to liberalize international trade.
(c) It establishes rules regarding international trade.
(d) WTO rules have forced the developing countries to remove trade barriers.
► (a)
31. Which one of the following is not true regarding the impact of globalization of India?
(a) It has created jobs in the service sector.
(b) People with education, skill and wealth have not benefited.
(c) Benefits of globalization are not shared equally.
(d) Labor laws are not implemented properly and workers are denied their rights.
► (d)
32. Which one of the following is a major benefit of joint production between a local company and a Multinational Company?
(a) MNC can bring latest technology in the production
(b) MNC can control the increase in the price
(c) MNC can buy the local company
(d) MNC can sell the products under their brand name
► (a) MNC can bring latest technology in the production
33. Which one among the following is a far reaching change in the policy made in India in 1991?
(a) Removing barriers or restrictions set by the government which is known as liberalization.
(b) Put barriers to foreign trade and foreign investments.
(c) Restrictions set by the government to protect the producers within the country from foreign competition.
(d) By giving protection to domestic producers through a variety of means.
► (a)
34. Which one of the following has benefited least because of globalization in India?
(a) Agriculture Sector
(b) Industrial Sector
(c) Service Sector
(d) Secondary Sector
► (a)
35. By 2006, how many countries were the members of the World Trade Organization?
(a) 139
(b) 149
(c) 159
(d) 169
► (b)
36. Entry of MNCs in a domestic market may prove harmful for:
(a) all large scale producers.
(b) all domestic producers.
(c) all substandard domestic producers.
(d) all small scale producers.
► (d)
37. The most common route for investments by MNCs in countries around the world is to:
(a) set up new factories
(b) buy existing local companies
(c) form partnerships with local companies
(d) None of these
► (a)
38. Removing barriers or restrictions set by the government is known as :
(a) privatization
(b) globalization
(c) liberalization
(d) socialization
► (c)
39. Taxes on imports is an example of :
(a) terms of trade
(b) collateral
(c) trade barriers
(d) foreign trade
► (c)
40. The most common route for investments by MNCs in countries around the world is to:(a) set up new factories
(b) buy existing local companies
(c) form partnerships with local companies
(d) None of these
► (a)
41. Which one of the following categories refers to investment?
(a) The money that is spent to buy assets such as land, building, machines, etc.
(b) The money that is spent on religious ceremonies.
(c) The money that is spent on social customs.
(d) The money that is spent on household goods.
► (a)
42. Why do MNCs set up offices and factories in more than one nation ?
(a) The cost of production is high and the MNCs can earn profit.
(b) The cost of production is low and the MNCs undergo a loss.
(c) The cost of production is low and the MNCS can earn greater profit.
(d) The MNCs want to make their presence felt globally.
► (c)
Question : MNC stands for
a) Multinational Corporation b) Multinational Corporation
c) Multinational Cities d) Multinational Council
Answer : A
Question : Investment made by MNCs is called
a) Investment b) Foreign Trade
c) Foreign Investment d) Disinvestment
Answer : C
Question : Process of integration of different countries is called
a) Liberalization b) Privatization
c) Globalization d) None of the above
Answer : C
Question : MNCs do not increase
a) Competition b) Price war c) Quality d) None of the above
Answer : D
Question : This helps to create an opportunity for the producers to reach beyond the domestic market
a) Foreign trade b) Domestic trade c) Internal trade d) Trade barrier
Answer : A
Question : Foreign Trade
a) Increases choice of goods b) Decreases prices of goods
c) Increases competition in the market d) Decreases earnings
Answer : D
Question : Globalization was stimulated by
a) Money b) Transportation c) Population d) Computers
Answer : B
Question : Production of services across countries has been facilitated by
a) Money b) Machine c) Labor d) Information and communication technology
Answer : D
Question : Tax on imports is an example of
a) Investment b) Disinvestment c) Trade barrier d) Privatization
Answer : C
Question : Liberalization does not include
a) Removing trade barriers b) Liberal policies
c) Introducing quota system d) Disinvestment
Answer : C
Question : Small Scale industries face competition from
a) Cheap imports
b) Rising prices
c) Exports
d) Subsidy
Answer : Cheap imports
Question : Which one is false?
a) MNCS offer subsidy to the small scale industries
b) MNCs acquire small companies to expand production
c) MNCs enter into joint venture to enter into foreign markets
d) MNCs set up own production center in foreign countries
Answer : MNCS offer subsidy to the small scale industries
Question : Globalization is not supported by
a) None of the options
b) Privatization
c) Liberalization
d) Information and communication technology
Answer : None of the options
Question : SEZ stands for
a) Special Economic Zone
b) Special Economic Package
c) Special Ecology Zone
d) None of the options
Answer : Special Economic Zone
Question : WTO stands for
a) World Trade Organization
b) World Tennis Organization
c) World Trade Office
d) World Trade center
Answer : World Trade Organization
Question : Liberalization does not include
a) Introducing quota system
b) Removing trade barriers
c) Disinvestment
d) Liberal policies
Answer : Introducing quota system
Question : Tax on imports is an example of
a) Trade barrier
b) Investment
c) Disinvestment
d) Privatization
Answer : Trade barrier
Question : Production of services across countries has been facilitated by
a) Information and communication technology
b) Money
c) Machine
d) Labor
Answer : Information and communication technology
Question : Globalization was stimulated by
a) Transportation
b) Money
c) Population
d) Computers
Answer : Transportation
Question : Foreign Trade
a) Decreases earnings
b) Increases choice of goods
c) Decreases prices of goods
d) Increases competition in the market
Answer : Decreases earnings
Question : This helps to create an opportunity for the producers to reach beyond the domestic market
a) Foreign trade
b) Domestic trade
c) Internal trade
d) Trade barrier
Answer : Foreign trade
Question : MNCs do not increase
a) None of the options
b) Competition
c) Price war
d) Quality
Answer : None of the options
Question : Process of integration of different countries is called
a) Globalization
b) Liberalization
c) Privatization
d) None of the options
Answer : Globalization
Question : Investment made by MNCs is called
a) Foreign Investment
b) Investment
c) Foreign Trade
d) Disinvestment
Answer : Foreign Investment
Question : MNC stands for
a) Multinational Corporation
b) Multinational Corporation
c) Multinational Cities
d) Multinational Council
Answer : Multinational Corporation
Globalization and the Indian Economy class 10 Economics NCERT SAQ:
Why is ‘tax’ on imports known as a trade barrier? (2011 OD)
Answer:
Tax on imports is known as a trade barrier because it increases the price of imported commodities. It is . called a barrier because some restriction has been set up.
Which organization lays stress on liberalization of foreign trade and foreign investment? (2014 D, 2012 OD)
Answer:
World Trade Organization (W.T.O).
ame an important barrier on foreign trade. (2013 D)
Tax on imports is an important barrier on foreign trade.
What is meant by “fair globalization’? (2013 OD)
Fair globalization means globalization that would create opportunities for all and ensure that its benefits are shared better.
What do you understand by the term ‘Foreign Direct Investment’? (2014 OD)
FDI is the investment of foreign capital in the economic and productive activities of a country by foreign companies or MNCs with the aim of expanding capacity and production to earn profits.
Why had the Indian Government put barriers to foreign trade and foreign investment after independence? State any one reason. (2015 D)
The Indian government after independence had put barriers to foreign trade and investment.
This was done to protect the producers within the country from foreign competition.
To protect the Indian economy from foreign infiltration in industries affecting the economic growth of the country as planned.
What is meant by a trade barrier? (2015 OD)
Barriers or restrictions that are imposed by the government on free import and export activities are called trade barriers. Tax on imports is an example of a trade barrier because it increases the price of imported • commodities. The government can use a trade barrier like ‘tax’ to increase or decrease (regulate) foreign trade and to decide what kind of goods and how much of what should come into the country.
Differentiate between investment and foreign investment. (2016 D)
The money that is spent to buy assets (land, building, machines and other equipment) is called investment, while the investment made by the MNCs is called foreign investment.
Why do MNCs set up their offices and factories in those regions where they get cheap labor and other resources? (2016 OD)
MNCs set up offices and factories for products in regions where they can get cheap labor and other resources so that—
the cost of production is low
the MNCs can earn greater profits.
Explain the role of the government to make globalization fair. (2011 D)
The government can play a major role in making fair globalization possible:
Fair globalization would create opportunities for all, and also ensure that the benefits of globalization are shared better. Government policies must protect the interests not only of the rich and the powerful, but also of all the people in the country.
Government should ensure that labor laws are implemented and workers’ rights are protected.
Government should support small producers to improve their performance till the time they become strong enough to compete with foreign competition.
If necessary, the government should use trade and investment barriers.
It can negotiate with the WTO for fairer rules.
It can also align with other developing countries with similar interests to fight against the domination of developed countries in the WTO.
Explain any three advantages of globalization. (2011 OD)
Globalization means integrating the economy of the country with the world economy.
Under this process, goods and services along with capital, resources and technology can move freely from one nation to another.
It has increased the movement of people between countries. People usually move from one country to another in search of better income, better jobs or better education. Earlier the movement of people between countries was less due to various restrictions.
Rapid improvement in technology has been one major factor that has stimulated the globalization
process. For instance, advancement in transportation technology has made much faster delivery of goods across long distances possible at lower costs. Container services have led to huge reduction in port handling costs. The cost of air transport has fallen which has enabled much greater volumes of goods being transported by airlines.Developments in information and communication technology (IT in short) has brought a revolution in telecommunications. It has made e-banking, e-commerce, e-leaming, e-mail and e-governance a reality.
Globalization has resulted in greater competition among producers and has been of advantage to consumers, particularly the well-off section. Rich people now enjoy improved quality and lower prices for several products.
What is a trade barrier? Why did the Indian Government put up trade barriers after Independence? Explain. (2011 OD)
The restrictions set by the Government to regulate foreign trade are called trade barriers. Tax on imports is an example of a trade barrier.
The Indian Government had put barriers to foreign trade and foreign investment after independence to protect the domestic producers from foreign competition. Imports at that stage would not have allowed local industries to come up. India allowed imports of only essential items such as machinery, fertilizers, petroleum, etc.
What would happen if the Government of India put a heavy tax on imports of Chinese toys? Explain any three points. (2012 D)
If Government of India puts heavy tax on import of Chinese toys
The cost of Chinese toys will increase.
Less Chinese toys would come in the Indian market.
Indian buyers would have lesser choice in the market and toys will become more expensive.
For Indian toy makers this would provide an opportunity to expand business as there will be less competition in the market.
How do Multinational Companies manage to keep the cost of production of their goods low? Explain with examples. (2013 D)
Or
Explain the conditions that determine MNCs setting up production in other countries? (2011 D)
MNCs set up offices and factories for production in regions where they can get cheap labor and other resources. Example, Countries like China, Bangladesh and India. They also provide the advantage of cheap manufacturing locations.
MNCs also need close-by markets for their manufacturing goods. Mexico and Eastern Europe are useful for their closeness to the markets in the US and Europe.
Besides these, MNCs also require skilled engineers and IT personnel and a large number of English speaking people who are able to provide customer care services (India possibly tops in this area).
All these factors help MNCs in saving costs of production by 50-60%.
How do we participate in the market as producers and consumers? Explain with three examples. (2013 D)
We participate in the market both as producers and consumers.
As producers of goods and services we could be working in any of the sectors like agriculture, industry or services.
For example, a farmer who sells wheat to a flour mill. The man at the mill grinds the wheat and sells the flour to a biscuit company. The biscuit company uses flour, sugar and oil to make packets of biscuits. It sells the biscuits in the market to the consumer. Biscuits are the final goods, i.e., the goods that reach the consumer and people as consumers buy.We as producers in the market could be made to sell the produce to the moneylender at a low rate in return for a timely loan.
For example, in the case of small farmers; the failure of crops often makes loan repayment impossible. They have to sell a part of their land to repay the loans.As consumers we participate in the market when we purchase goods and services that we need. As individual consumers we often find ourselves in a weak position. Whenever there is a complaint regarding a good or service that had been bought, the seller tries to shift all the responsibility on to the buyer.
For example, a long battle had to be fought with court cases to make cigarette manufacturing companies accept that their product could cause cancer.
How are local companies benefited by collaborating with multinational companies? Explain with examples. (2013 OD)
When local companies enter into a joint venture with MNCs:
First, the MNCs provide money for additional investments for faster production.
Second, MNCs bring with them the latest technology for enhancing and improving the production.
Some Indian companies have gained from successful collaborations with foreign companies.
Globalization has enabled some companies to emerge as multinationals.Parakh Foods was a small company which has been bought over by a large American Company — Cargill Foods. Parakh foods had built a large marketing network in various parts of India as a well- reputed brand. Parakh Foods had four oil refineries whose control has now shifted to Cargill. Cargill is now the largest manufacturer of edible oil in India making five million pouches daily.
How has foreign trade been integrating markets of different countries in the world? Explain with examples. (2012 OD)
Or
“Foreign trade integrates the markets in different countries.” Support the statement with arguments. (2015 OD)
(i) Foreign trade creates opportunities for producers to reach beyond domestic markets. Producers can compete in markets located in other countries of the world. Similarly, for the buyers, import of goods from another country leads to expanding choice of goods beyond what is domestically produced. Buyers can thus choose from a wide range of products to suit their individual tastes.
(ii) With the opening of trade, goods travel from one market to another. Choice of goods in the market rises. Prices of similar goods in two markets tend to become equal, and producers in the two countries now closely compete against each other even though they are separated by thousands of miles. Foreign trade, thus, results in connecting the markets or integration of markets in different countries.
For example., There are an endless number of footwear brands available in the Indian market. A consumer who is aware of international trends can choose between a local brand like Bata, Lakhani and international brands like Adidas, Nike, Reebok etc.
Define the term liberalization. Explain the reasons why the Indian Government started the policy of liberalization in 1991. (2014 D)
Or
‘Barriers on foreign trade and foreign investment have been removed to a large extent in India since 1991’. Justify the statement. (2016 D)
Removing barriers or restrictions set by the government on foreign trade and foreign investment is what is known as liberalization. The Indian Government removed these barriers because:
Liberalization of trade and investment policies allows Indian producers to compete with producers around the globe leading to an improvement in performance and quality of products.
After the barriers on foreign trade and foreign investment were removed to a large extent, goods could be imported and exported easily and also foreign companies could set up factories and offices in India. This has led to an increase in trade with different countries.
Businesses are allowed to make decisions freely about what they wish to import or export due to the liberal policies of the government.
Doors of investment opened up for MNCs. They have been investing large sums of money in India and have been seeking to earn large profits.
How has information and communication technology stimulated the globalisation process? Explain with examples. (2014 D)
Information and communication technology has helped globalization in the following ways:
Rapid improvement in technology has contributed greatly towards globalization. Advanced technology in transport systems has helped in the delivery of goods faster across long distances at lower costs.
Development in information and communication technology has also helped a great deal. Telecommunication facilities — telegraph, telephone, mobile phones, fax are used to contact one another quickly around the world, access information instantly and communicate from remote areas. This is possible due to satellite communication devices. Teleconferences help in saving frequent long trips across the globe.
Information technology has also played an important role in spreading out production of services across countries. Orders are placed through the internet, designing is done on computers, even payment of money from one bank to another can be done through e-banking through the internet. The Internet also allows us to send instant electronic mail (e-mail) and talk (voice-mail) across the world at negligible cost.
Why had the Indian government put barriers to foreign trade and foreign investment after independence? Explain. (2014 D)
Or
Why had the Indian government put barriers to foreign trade and foreign investments after independence? Analyze the reasons. (2016 OD)
The Indian government after independence had put barriers to foreign trade and investment. This was done to protect the producers within the country from foreign competition. Industries were just coming up in the 1950s and 1960s and competition from imports at that stage would not have allowed these industries to develop and grow. Imports of only essential items such as machinery, fertilizers, petroleum etc. were allowed.
Another reason was to protect the Indian economy from foreign infiltration in industries affecting the economic growth of the country as planned. India wanted to move faster to catch up with the main industries in the world market and therefore had to keep an extra watch on its progress in international trade and give incentives to the more rapidly growing industries through fiscal tariff and other means.
How are MNCs able to cope with large demands from all over the world and control prices? (2014 OD)
Large MNCs in developed countries place orders for production with small producers.
The MNCs sell these under their own brand names to the customers.
As they control the market with the huge demand, they are able to control prices.
“A wide ranging choice of goods are available in the Indian markets.” Support the statement with examples in context of globalisation. (2016 D)
Globalization has led to integration of markets across countries. The Indian markets are now flooded with a wide ranging choice of goods. Import from other countries has led to an expanding choice of goods beyond what is domestically produced —
We have a wide variety of goods and services before us in the market.
The latest models of digital cameras, mobile phones and televisions made by leading manufacturers of the world like Sony, Samsung etc. are available in the market.
Every season, new models of automobiles can be seen on Indian roads. Today Indians are buying cars produced by nearly all the top companies in the world.
A similar explosion of brands can be seen for many other goods like footwear. For example, Adidas, Nike, Reebok, Puma and many more.
In spite of Globalization, creating good quality products and expanding the market, how is it affecting the stability in jobs for the workers? (2014 OD)
Employment of ‘flexible workers’.
Increased competition, objective to lower costs, the ax falls on the ‘labor costs’—temporary jobs given.
Longer working hours for labor to get suitable salaries.
Examine any three conditions which should be taken care of by multinational companies to set up their production units. (2017 D)
Conditions:
MNCs set up offices and factories for production in regions where they can get cheap labor and other resources. Example, Countries like China, Bangladesh and India. They also provide the advantage of cheap manufacturing locations.
MNCs also need close-by markets for their manufacturing goods. Mexico and Eastern Europe are useful for their closeness to the markets in the US and Europe.
Besides these, MNCs also require skilled engineers and IT personnel and a large number of English speaking people who are able to provide customer care services (India possibly tops in this area).
All these factors help MNCs in saving costs of production by 50-60%.
How do Multinational corporations (MNCs) interlink production across countries? Explain with examples. (2017 OD)
MNCs set up production in various countries based on the following factors:
MNCs set up offices and factories for production in regions where they can get cheap labor and other resources; eg., in countries like China, Bangladesh and India. These countries also provide the advantage of cheap manufacturing locations.
At times, MNCs set up production jointly with some of the local companies of countries around the world. The benefit of such joint production to the local company is two-fold. First, the MNCs can provide money for additional investments for faster production. Secondly, the MNCs bring with them the latest technology for enhancing and improving production.
Some MNCs are so big that their wealth exceeds the entire budgets of some developing countries. This is the reason why they buy up local companies to expand production.
eg. Cargill Foods, a very large American MNC has bought over smaller Indian companies such as Farakh Foods.There is another way in which MNCs control production and that is by placing orders for production with small producers in developing nations; eg., garments, footwear, sports items etc. The products are supplied to these MNCs which then sell these under their own brand name to customers. MNCs also enter into close competition with local companies thereby influencing production in distant locations.
Globalization and the Indian Economy class 10 Economics NCERT long question:
Give the meaning of WTO? What is the major aim of the WTO? Mention any two shortcomings of WTO? (2011 D, 2012 OD)
WTO (World Trade Organization). The WTO believes that there should not be any barriers between trade between different countries. Trade between countries should be free.
Aims of WTO:
To liberalize international trade.
To establish rules regarding international trade.
Two shortcomings of WTO:
Though WTO is supposed to allow free trade for all, in practice, it is seen that the developed countries have unfairly retained trade barriers and continued to provide protection to their producers. For example, farmers in the US receive huge sums of money from the government and as a result can sell the farm products at abnormally low prices in other countries, adversely affecting farmers in those countries.
On the other hand WTO rules have forced the developing countries to remove trade barriers.
What is globalization? Explain with three examples how top Indian companies have benefited from globalization. (2011 OD)
Globalization is the process of rapid integration or interconnection among countries. It is the integration between countries through foreign trade and foreign investments by multinational corporations. It means the coming together of various economies of the world to form a global economy.
The top Indian companies have benefited from the increased competition and globalization.
They have invested in new technology and production methods and raised their production standards.
Some have gained from successful collaborations with foreign companies.
Moreover, globalization has enabled some large Indian companies to emerge as multinationals themselves. For example, Tata Motors, Infosys, Ranbaxy, Asian Paints, Sundaram Fasteners etc.
What is an MNC? Give two examples of Indian companies that have emerged as MNCs. What are the harmful effects of MNCs to a host country? Give three examples. (2012 OD)
A Multinational Corporation (MNC) is a company that owns or controls production in more than one nation. The goods and services are produced globally. The production process is divided into small parts and spread out across the globe.
Tata Motors (automobiles), Infosys (IT), Ranbaxy (medicines), Asian Paints (paints), Sundaram Fasteners (nuts and bolts), etc. are some of the Indian companies which are spreading their operations worldwide as MNCs.
Harmful effects of MNCs to a host country:
Small producers compete or perish. MNCs have posed major challenges for a large number of small producers and workers. The small manufacturers have been hit hard due to competition. Several of the units have shut down rendering many workers jobless. Batteries, taps, tyres, dairy-products, vegetable oil are some of the industries that are badly affected due to stiff competition from MNCs.
Uncertain employment. In order to maximize the profit MNCs look for a location with minimum labor costs. Faced with competition, most employers these days prefer to employ workers on a temporary basis so that they do not have to pay workers for the whole year. This has changed the lives of workers and their jobs are no longer secure.
The Condition of employment. Workers also have to put in very long working hours and work night shifts on a regular basis during the peak season. Wages are low and workers are forced to work overtime to make both ends meet. The workers are denied their fair share of benefits and no longer get the protection that they enjoyed earlier, for example, the Indian garment export industry often denies their workers their fair share of benefits.
How has globalization been advantageous to both the producers as well as the consumers in India? Explain. (2012 OD)
To Producers. Several of the top Indian Companies have been able to benefit from the increased competition.
They have invested in newer technology and production methods and thereby raised their production standards.
They have gained from successful collaborations with foreign companies.
Globalization helped in the development of the IT sector.
Good quality products are being produced at lower prices.
To Consumers. There is greater choice before consumers who can enjoy improved quality and lower prices for several products.People today enjoy much higher standards of living than was possible earlier.
How has globalization benefited India? Explain with five examples. (2013 OD)
Globalization has benefited India in the following ways:
1. People with education, skill and wealth have benefited by globalization.
Greater competition among producers (both local and foreign) has been advantageous to consumers, particularly the well-off section. Rich people enjoy improved quality at lower prices for several products and enjoy a higher standard of living.
MNCs have increased their investments in India over the past 20 years in industries such as cell phones, automobiles, electronics, soft drinks, fast food and services such as banking.
New jobs have been created in all these industries and services.
Top Indian companies have benefited from the increased competition. They have invested in newer technology and production methods.
Some Indian companies have gained from successful collaborations with foreign companies. Globalization has enabled some companies to emerge as multinationals.
How is the Government of India trying to attract more foreign investment? Explain with examples. (2013 OD)
In order to attract foreign investment, the Government has taken the following steps:
All the barriers and restrictions on foreign trade and investment have been removed to a large extent.
Liberalization of investment policies has allowed Indian producers to compete with the producers around the globe.
Allowing privatization of many public sector industries by the government.
Allowing businesses to make decisions freely about what they wish to import or export.
The government has allowed flexibility in labor laws to attract foreign investment for the benefit of companies.
What is the meaning of SEZ? Mention any three features of SEZ. (2011 D)
SEZ or Special Economic Zones are industrial zones set up by the Central and State Governments with world class facilities in electricity, water, roads, transport, storage, recreational and educational facilities. Three features of SEZ:
The companies who set up production units in the SEZs do not have to pay taxes for an initial period of five years.
Government has also allowed flexibility in the labor laws to attract foreign investment. This is done to reduce the cost of labor for the company.
These are being set up to attract foreign companies to invest in India.
“Advancement of international trade of a country is an index of its economic prosperity.” Justify the statement with five arguments. (2013 OD)
“Advancement of international trade of a country is an index to its economic prosperity”.
As no country is self-sufficient in all resources, it cannot survive without international trade.
If the balance of international trade is favorable, a country will be able to earn more foreign exchange.
International trade encourages a country to develop secondary and tertiary sectors for exporting goods which can fetch more foreign exchange.
A country’s economic prosperity can be gauged by the health of its international trade.
A country can earn large amounts of foreign exchange through international trade.
Explain the role of multinational corporations in the globalization process. (2014 D)
Answer:Globalization is the process of rapid integration or inter-connection among countries. MNCs have contributed greatly in the process of globalization.
MNC’s have set up production centers in various countries and are supplying produced goods, services and technology to various countries.
The countries of the world have come closer. It has also increased the movement of people between countries.
The MNCs provide money for additional investments, for faster production. Also, MNCs bring with them the latest technology for enhancing and improving the production.
How has improvement in technology stimulated the globalization process? Explain with five examples. (2013 OD, 2012 D)
Improvements in technology have helped in globalization in the following ways:
Rapid improvement in technology has contributed greatly towards globalization. Advanced technology in transport systems has helped in the delivery of goods faster across long distances at lower costs.
Development in information and communication technology has also helped a great deal. Telecommunication facilities—telegraph, telephone (including mobile phones), and fax are now used to contact one another quickly around the world, access information instantly and communicate from remote areas. Teleconferences help in saving frequent long trips across the globe.
Information technology has also played an important role in spreading out production of services across countries. Orders are placed through the internet, designing is done on computers, even payment for designing and printing can be arranged through the internet. The Internet also allows us to send instant electronic mail (e-mail) and talk (face-to-face) across the world at negligible cost.
The cost of air transport has fallen which has enabled much greater volumes of goods being transported by airlines.
Technology has made e-banking, e-commerce, e-learning, e-mail and e-governance a reality.
What is globalization? Describe the role of Multinational Corporations (MNCs) in promoting the globalisation process. (2016 D)
Globalization is the process of rapid integration or inter-connection among countries. Over the last 20-30 years, there has been a tremendous increase in globalization with the increase in the number of MNCs.
MNCs set up production centers worldwide where cheap labor is available, markets are near and government policies are favorable.
They supply produced goods to different countries.
Countries of the world have come closer due to increased movement of people between countries.
MNCs provide money for additional investments for faster production.
MNCs bring with them the latest technology and know-how for enhancing and improving the production process.
Question 41.What is trade? Explain the importance of international trade. (2015 OD, 2016 D)
The exchange of goods among people, states and countries is referred to as trade.
Importance of international trade:
International trade of a country is an index to its economic prosperity.
It is considered the economic barometer for a country. If the balance of international trade is favorable, a country will be able to earn more foreign exchange.
As no country is self-sufficient in all resources it cannot survive without international trade.
Countries have trade relations with the major trading blocs.
Exchange of commodities and goods have been superseded by the exchange of information and knowledge.
Describe the impact of globalization on the Indian economy with examples. (2016 OD)
Or, “Globalization and greater competition among producers has been of advantage to consumers.” Justify the statement with examples. (2015 OD)
Impact of Globalization on the Indian Economy:
Greater competition among producers (both local and foreign), has been advantageous to consumers, particularly the well-off section. There is greater choice before the consumers who now enjoy improved quality and lower prices for several products.
Globalization has led to a higher standard of living especially in urban areas.
MNCs have increased their investments in India in industries such as electronics, automobiles, cellphones, soft drinks, fast food, banking services etc. thereby providing consumers with a vast variety of products. New job opportunities have been created in these industries and services, thereby increasing purchasing power.
Globalization has enabled some large Indian companies to emerge as MNCs themselves like Tata Motors, Infosys, Ranbaxy, Asian Paints, etc.
Globalization has also created new opportunities for companies providing services particularly those involving IT (Information Technology)- For example, call centers.
Top Indian companies have benefited from the increased competition. They have invested in newer technology and production methods indirectly benefiting the consumers.
Local companies supply raw materials to foreign industries and have prospered.
However, for a large number of producers and workers the impact has not been uniform, and globalization has posed major challenges.
How are MNCs spreading their products? Explain with examples. (2014 OD)
Or, How are multinational corporations (MNCs) controlling and spreading their production across the world? Explain. (2015 D)
MNCs set up production in various countries based on the following factors:
MNCs set up offices and factories for production in regions where they can get cheap labor and other resources; e.g., in countries like China, Bangladesh and India. These countries also provide the advantage of cheap manufacturing locations.
At times, MNCs set up production jointly with some of the local companies of countries around the world. Such joint production also provides benefits to the local company.
MNCs with huge amounts of wealth sometimes buy up local companies to expand production, e.g., Cargill Foods, a very large American MNC has bought over smaller Indian companies such as Parakh Foods.
There is another way in which MNCs control production and that is by placing orders for production with small producers in developing nations; e.g., garments, footwear, sports items etc. The products are supplied to these MNCs which then sell these under their own brand name to customers. MNCs also enter into close competition with local companies thereby influencing production in distant locations.
How do banks play an important role in the economy of India? Explain. (2015 OD)
Banks help people to save their money and keep their money in safe custody. To ensure the safety of their money, people deposit their money with banks. Banks accept deposits and pay interest on deposits. People have the provision to withdraw their money as and when they require.
Banks also grant loans to people for a variety of purposes. In times of need individuals, business houses and industries can borrow money from the banks.
Credit provided by banks is crucial for the country’s growth and economic development. Credit is needed for all kinds of economic activities, to set up business, buy cars, houses, etc.
Banks also help people in obtaining cheap and affordable loans. This can help people to grow crops, do business, set up small-scale industries or trade in goods and also help indirectly in the country’s development. They should do so, so that relatively poor people do not have to depend on informal sources of credit (money-lenders).
Describe the vital and positive role of credit with examples. (2016 D)
In the festive season, a shoe manufacturer, Ram receives an order from a large trader in town for 3,000 pairs of shoes to be delivered in a month’s time. To complete production on time Ram has to hire workers for stitching and pasting work. He has to purchase the raw materials. To meet these expenses Ram obtains loans from two sources.
First, he asks the leather supplier to supply leather now and promises to pay him later.
Second, he obtains a loan in cash from the large traders as advance payment for 1000 pairs of shoes with a promise to deliver the whole order by the end of the month.
At the end of the month, Salim is able to deliver the order, make a good profit and repay the money he had borrowed.
Salim obtains credit to meet the working capital needs of production. The credit helps him to meet the ongoing expenses of production, complete production on time and thus increase his earnings. Credit therefore plays a vital and positive role in this situation.
How can the formal sector loans be made beneficial for poor farmers and workers? Suggest any five measures. (2016 OD)
Formal sector loans can be made beneficial for poor farmers and workers in the following ways:
Create greater awareness among farmers about formal sector loans.
Process of providing loans should be made easier. It should be simple, fast and timely.
More Nationalized Banks/cooperative banks should be opened in rural sectors. Banks and cooperatives should increase the facility of providing loans so that dependence on informal sources of credit reduces.
The benefits of loans should be extended to poor farmers and small scale industries.
While formal sector loans need to expand, it is also necessary that everyone receives these loans. It is important that formal credit is distributed more equally so that the poor can benefit from cheaper loans.
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