Liberalization is a policy measure relating to economic policies. It advocates liberalizing of economy against unnecessary controls and regulations. It does not support any unwanted restriction.
In India this policy was introduced in 1991 as New Industrial Policy to liberate the trade and industry from the restrictions of government and abolished the system of industrial licensing.
Without the policy of liberalization there are undue delays, inefficiency and corruption. But the policy of liberalization brings transparency in the policy and is a type of economic reform.
Globalization is a broad term that is used for an emerging global society in which economic, political, cultural and environmental events taking place in one part of the world quickly come to have significance for people of other parts of the world.
Globalization, therefore, is the result of communication and information technologies. It establishes links between individuals, communities and governments. Various international institutions and multinational companies play an important role in Globalization.
People may continue to live in a single nation but culturally or psychologically they are engaged with the lives of people of other countries. Globalization has both positive as well as negative points.
The positive points are: sharing of knowledge, resources technology, investments, values etc. and the negative points are: spreading of diseases, drugs, crime, terrorism, uncontrolled migration etc. The most significant impact of globalization is the increase in trade. In the period from 1950 to 2009, the volume of export grew by 60 times.
IMPACTS OF LIBERALIZATION AND GLOBALIZATION
## Impact on Agriculture:
Under the policy of liberalization and globalization, the agriculture sector is trying to rationalize its activities to face international competition in marketing the products.
In case of India, the agricultural exports will be benefited. Major impacts of liberalization and globalisation on agriculture are:
- Substantial increase in the production of food-grains.
- Agricultural sector has been diversified to produce commercial crops, fruits, vegetables, spices, cashews, flowers, orchids etc. because demand for these items is also increasing.
- Expansion of trade of agricultural items throughout the world.
- Development and expansion of agricultural items throughout the world.
- Development of agriculture in the backward areas.
- Increasing use of chemical fertilizers, insectisides and pesticides.
- Increase in unemployment in the agriculture sector.
- More investment in agriculture.
## Impact on Industries:
Industrialization is fast picking up in the developing countries whereas in the developed countries it has almost attained the highest level. Major impacts of liberalization and globalization on industry are:
- Adverse impact of multinational companies of small industries. It has led to the closure of many small industries. Several people became jobless.
- Mass Production or large scale manufacturing using mechanization and assembly line method.
- Fall in the unemployment specially in the developing countries.
- Diversification of industry with several new industies coming up.
- Fast exploitation of minerals due to increasing demand.
- Increasing demand of agricultural raw material for agro based industries.
- Increasing use of technology and it's spread throughout the world.
- Development of backward areas with installation of some industries.
- Increasing investment in the industrial sector.
- Increasing pollution and degradation of environment due to over industrialization.
- New techniques of pollution control made available throughout the world.
- Huge increase in the trade of industrial goods.
- Competitiveness among the industries.
- Consumer oriented shift in the industry....