[30389]
Before the 1990, India's economic model was dominated by a large public sector, which favoured partitions for domestic industry. There was distrust for private sector and suspicion of foreign investment, with extremely high taxation levels on imported goods and a different business environment for foreign business interests. However, a balance of payment crisis in —rushed India to seek loans from the International Monetary Fund and liberalise the economy.
India embarked upon the policies of liberalization, privatization and globalization, mainly in the last two decades of the 20th century.
BOON
In discussing the issue of globalisation in the Indian context, the word is used, i.e. the technological changes, and associated policy changes, that have brought the world economies closer and made them more integrated with each other. In this particular sense, the changes that have occurred in the patterns of trade and capital flows in recent years are to India’s advantage – although, unfortunately, so far we have not made much use of it. Today, in terms of the potential benefits of globalisation, India is in a very different position than would have been the case 50 or even 20 years ago.
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.
Personal Finance:
• Entry of the private sector banks has completely transformed the functioning of public sector banks
• Opening up of mutual funds; thirty five players; 15 joint ventures
• Commencement of the depository that helped common men to become the retail investors
• Deregulation of insurance industry; Nineteen players; 14 joint ventures in life insurance sector
• Fall in interest rates; smaller monthly installments made life more simple to Indian customer
• ATM's (Automated Teller Machines) made bank transactions more easier to common men than few years back
• Online trading, online purchanse of various finance products and online banking have helped common men to participate in investment process.
Job Sector:
• Salaries are now more attractive than in the nineties.Average annual IT salary has increased from Rs 1.6 lakh in 1998 to Rs 5.5 lakh in 2008
• Students get selected by the companies through campus recruitment an year before the date of completion of their technical education.
• Large salary hikes than offered few years ago.
• More emphasis on performance and not on number of years in the job
• More flexibilities in timings and work from home arrangements are becoming common
• In the last ten years, annual revenue of software industries has grown by 350%.
• Around 1.16 crore people are employed in BPO sector compared to only few lakh in the year 1998
• Office automation has helped improving effeciency of employees
• More and more recruitment are being made using job portals. Earlier ads were placed in the newspapers. | |
You May Also Find These Documents Helpful
-
Globalization and India’s economic growth has constructed two seemingly contradictory narratives of the effects of this phenomenon. Thomas Friedman’s The World is Flat and Katherine Boo’s Behind the Beautiful Forevers, both exemplify the disparity between these two realities. Friedman frames globalization as a “world flattener” that will create new possibilities, opportunities, and equalize people across the globe. He uses India as an example of a nation that has successfully adapted to the new needs of globalization and thus experienced an…
- 1401 Words
- 6 Pages
Better Essays -
The primary example of the effect of globalization on India's economy is in their government and their military. In the last decade India’s defense budget has increased from $16.74 billion in 2004 to $20.11…
- 1118 Words
- 4 Pages
Good Essays -
The Indian economy, in the last decade, transitioned from an inward looking, closed economy, to a liberalized,export-oriented one. The software sector witnessed unprecedented growth, with exports growing at a compounded annual growth rate (CAGR) of around 45 percent and domestic software sales at around 35 percent. In fact, before 1991, the Indian software sector was adversely affected by the restrictive economic policies. Thus, this sector provides an appropriate case study on how liberalization of the economy reduced friction to business and accelerated growth.…
- 1666 Words
- 7 Pages
Good Essays -
economy. Except for restrictions on foreign investment in retail, India now has a competitive foreign investment regime.The financial sector has likewise seen the introduction of numerous reforms. Banks’ discretion over the allocation of funds has…
- 612 Words
- 3 Pages
Good Essays -
Initially, according to most of the economists, globalization refers to “development of global financial markets”, which means that countries are now able to interact and benefit from each other, additionally globalization allows countries to specialize what they do best, and maximizing the revenue from their output through trade between countries. For example, Carnegie Mellon University’s research (n.d) pointed out that India has become the world largest software industry due to the country’s comparative advantage on cost and availability of software talent, compared to the…
- 1433 Words
- 5 Pages
Powerful Essays -
* India being a closed economy till 1991, there was high level of intervention by the government in the corporate sector…
- 794 Words
- 4 Pages
Satisfactory Essays -
Until the 1980s, India focused on self-reliance and there was disinclination towards foreign investment. Ever since the economic reforms were launched in the early 1990s, Indian markets were opened to attract foreign investments in different formats. Foreign investments…
- 5365 Words
- 22 Pages
Powerful Essays -
The Indian economy had left behind the low-growth track of the early 1980s, following the bold economic reforms initiated in 1991-93. India began to appear as a significant player in the global economy. India’s exports began to climb, its foreign exchange reserves, which for decades had hovered around 5 billion dollars, rose exponentially after the economic reforms and in little more than a decade had risen to 300 billion dollars. Indian corporations that rarely ventured out of India suddenly started investing all over the world and even in some industrialized countries.…
- 1354 Words
- 6 Pages
Good Essays -
About the Indian economy- The economy of India is the ninth-largest in the world by nominal GDP and the third-largest by purchasing power parity(PPP). India is the 19th-largest exporter and the10th-largest importer in the world. The independence-era Indian economy (from 1947 to 1991) was based on a mixed economy combining features of capitalism and socialism, resulting in an inward-looking, interventionist policies and import-substituting economy that failed to take advantage of the post-war expansion of trade. This model contributed to widespread inefficiencies and corruption, and the failings of this system were due largely to its poor implementation. In 1991, India adopted liberal and free-market principles and liberalised its economy to international trade under the guidance of Former Finance minister Manmohan Singh under the Prime Ministry of P.V. Narasimha Rao, prime minister from 1991 to 1996, who had eliminated Licence Raj, a pre- and post-British era mechanism of strict government controls on setting up new industry. Following these major economic reforms, and a strong focus on developing national infrastructure such as the Golden Quadrilateral project by Atal Bihari vajpayee, prime minister, the country 's economic growth progressed at a rapid pace, with relatively large increases in per-capita incomes.…
- 405 Words
- 2 Pages
Satisfactory Essays -
INTRODUCTION During the years preceding the liberalization of the Indian economy, companies faced limited competition…
- 4827 Words
- 20 Pages
Powerful Essays -
India was a latecomer to economic reforms, embarking on the process in earnest only in 1991, in the wake of an exceptionally severe balance of payments crisis. The need for a policy shift had become evident much earlier, as many countries in East Asia achieved high growth and poverty reduction through policies which emphasized greater export orientation and encouragement of the private sector. India took some steps in this direction in the 1980s, but it was not until 1991 that the government signaled a systemic shift to a more open economy with greater reliance upon market forces, a larger role for the private sector including foreign investment, and a restructuring of the role of government.…
- 7918 Words
- 32 Pages
Powerful Essays -
INDIA'S ECONOMIC REFORMSThe reform process in India was initiated with the aim of accelerating the pace of economic growth and eradication of poverty. The process of economic liberalization in India can be traced back to the late 1970s. However, the reform process began in earnest only in July 1991. It was only in 1991 that the Government signaled a systemic shift to a more open economy with greater reliance upon market forces, a larger role for the private sector including foreign investment, and a restructuring of the role of Government.The reforms of the last decade and a half have gone a long way in freeing the domestic economy from the control regime. An important feature of India's reform programme is that it has emphasized gradualism and evolutionary transition rather than rapid restructuring or "shock therapy". This approach was adopted since the reforms were introduced in June 1991 in the wake a balance of payments crisis that was certainly severe. However, it was not a prolonged crisis with a long period of non-performance.The economic reforms initiated in 1991 introduced far-reaching measures, which changed the working and machinery of the economy. These changes were pertinent to the following: * Dominance of the public sector in the industrial activity * Discretionary controls on industrial investment and capacity expansion * Trade and exchange controls * Limited access to foreign investment * Public ownership and regulation of the financial sectorThe reforms have unlocked India's enormous growth potential and unleashed powerful entrepreneurial forces. Since 1991, successive governments, across political parties, have successfully carried forward the country's economic reform agenda.Reforms in Industrial PolicyIndustrial policy was restructured to a great extent and most of the central government industrial controls were dismantled. Massive deregulation of the industrial sector was done in order to bring in the element of…
- 716 Words
- 3 Pages
Good Essays -
India’s staggering population, entrepreneurial spirit, and consumer-led demand for products has placed it among the emerging market nations known as the BRIC (Brazil, Russia, India, and China) countries. These nations are widely believed to be the next financial juggernauts that will become key players in the global economic framework. In the past several decades, India has undertaken massive reform to its financial policies. These policies have opened the door to increases in consumption of Indian goods abroad. Once an insular country, India has become more open to direct foreign investment, increasing real estate profits and acquisitions of businesses, and it has undergone a technology boom that challenges even leading nations in the economic circle. However, India has challenges, including a hesitance to fully open trade channels, rising inflation, and a strong caste system which impacts its ability to operate in the same vein as other democratic nations. It will remain to be seen whether India can sustain its emerging growth potential.…
- 3257 Words
- 13 Pages
Best Essays -
Globalisation means gradual integration of economies through free movement of goods, services and capital which has significant impact on the economies of both developed and developing countries. Therefore, globalisation refers to a process of growing economic interdependence among different countries of the world. Thus, in the globalised era, the whole world is changing into a global village in the sense that economic activities in one part of the globe are affecting significantly the rest of the world. For this purpose, it becomes necessary for India to participate in the process of globalisation (Ashutosh, 2002). The New Economic Policy of 1991 aimed at making Indian economy competitive and much better integrated with the rest of the world. The liberalisation and economic reform process which included both short term and long term measures have direct and indirect bearing on the manufacturing sector of India in general and small scale sector in particular. The dynamics of change will bring about inflow of technology, resources and both human and physical capital that are scarce or costly to be procured locally in the developing economies like India. This will lead to rise in the productive capacity of the nation to supply increasingly diverse economic goods and services to its growing population. Therefore, globalisation can bring immense benefits to various countries that are able to harness the resulting opportunities for the proper development of their material and human resource endowments (Nemedia, 1997). Besides offering greater opportunities for economic growth, globalisation has also posed some important challenges which may be viewed as problems from the perspective of developing countries like India. With the launching of the process of liberalisation, globalisation and formation of WTO, the Indian small scale industrial sector will…
- 8784 Words
- 36 Pages
Powerful Essays -
India was a latecomer to economic reforms, embarking on the process in earnest only in 1991, in the wake of an exceptionally severe balance of payments crisis. The need for a policy shift had become evident much earlier, as many countries in east Asia achieved high growth and poverty reduction through policies which emphasized greater export orientation and encouragement of the private sector. India took some steps in this direction in the 1980s, but it was not until 1991 that the government signaled a systemic shift to a more open economy with greater reliance upon market forces, a larger role for the private sector including foreign investment, and a restructuring of the role of government.…
- 5023 Words
- 19 Pages
Good Essays