a study on impact of liberalization and globalization …icmrr.org/feb_2015/ijfrr/20152205.pdf · a...

A STUDY ON IMPACT OF LIBERALIZATION AND

GLOBALIZATION OF INDIAN INDUSTRY

N.BHUVANESH KUMAR 1

G.NANTHA KUMAR 2

1 Assistant Professor, PG Department of International Business, NGM College, Pollachi 2 Research Student, PG Department of International Business, NGM College, Pollachi

ABSTRACT

After independence, it has been the vision of Indian government to adopt some economic

reforms i.e. Liberalization, Privatization & Globalization. Our govt. adopted “liberalization &

globalization” both as important weapons to enhance industrialization and foreign trade. Now India

can export & import commodities freely. The growing integration of economies and societies around

the world has been one of the most hotly debated topics in international economics over the past few

years. This paper explores the contours of the on-going process of Liberalization and globalization.

Throughout this paper, there is an underlying focus on the impact of LPG on Indian economy. It also

comments on impact of LPG on Developing countries. But Globalization has also generated

significant international opposition over concerns that it has increased inequality and environmental

degradation. There is a need to study the impact of globalization on developing countries from the

viewpoint of inward foreign direct investment. India has made a tremendous progress in many spheres

such as industries, trade, agriculture & finance. Due to liberalization and globalization, government is

moving heaven & earth to solve adverse balance of payment.

Keywords: Libralisation, Globalisation, Foreign Direct Investment

INTRODUCTION

Globalization and liberalization has greatly influenced the Indian economy and made it a huge

consumer market. Today, most of the economic changes in the country are based on the demand

supply cycle and other economic factors. Today, India is the worlds 12th largest economy in terms of

market exchange rate and 4th largest in terms of the Purchasing Power Parity. According to a report

by the World Bank, the Indian market is expected to grow at around 8 per cent in the year 2010.

Globalization and liberalization has also made a positive impact on various important economic

segments. Today, the service sectors, industrial sectors and the agriculture sector have really grown to

a great extent. Around 54 per cent of the annual Gross Domestic Product (GDP) of India comes from

the service industry while the industrial and agriculture sector contributes around 29 per cent and 17

per cent respectively. With the improvement of the market, more and more new sectors are coming up

and reaping profits such as IT services, chemical, textiles, Oil industry and so on. With the increase in

the supply level, the rate of employment is also increasing considerably.

STATEMENTOF THE PROBLEM

Trade liberalisation measures are introduced to improve the export performance of the

country by reducing the barriers to trade. With the opening up of the trade sector it is expected that the

country can engage in more trade relations with other Countries in without much restrictions. The

ultimate objective of trade reform measure is to improve the competiveness and thereby better export

performance. Thus the trade liberalisation measures will improve the export performance by

improving the competitiveness , which will improve production, improve quality standards, better

INTERCONTINENTAL JOURNAL OF FINANCE RESEARCH REVIEWISSN:2321-0354 - ONLINE ISSN:2347-1654 - PRINT - IMPACT FACTOR:0.720VOLUME 3, ISSUE 2, FEBRUARY 2015

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marketing strategy, etc. But the trade policy reform will affectthe different sectors of the economy in a

different manner, as there strategies may be different. There may be some sector specific factors

determining the impact of reforms when we take into consideration industry level and firm level

export performance.

SCOPE OF THE STUDY

The Present study examines the impact of trade liberalisation of India‟s exports. The study

covers for a period of ten financial years starting from 2010. Thus, the study is exclusively on the

impact of liberalisation and Globalization on the Indian Economy in the post-reform period. There is a

need to study the impact of globalization on developing countries from the viewpoint of inward

foreign direct investment. This paper explores the contours of the on-going process of globalization

Liberalization and privatization.

OBJECTIVES OF THE STUDY

Assessing the export of oil and non-oil products.

To study the export of India‟s foreign trade with developing Countries in.

To study the Exports of Principal Commodities.

To make fruitful suggestions for the growth and success of manufacturing industries in India

RESEARCH METHODOLOGY

The study is made for the purpose of an in depth analysis of various indicators and its effect

on import and export of India‟s foreign trade. The methodology selected for the study will be here.

The planned research design, methods of sample selection, data collection and analysis of results will

be explained.

DATA SOURCE

The study used only secondary data, which are collected from the various sources ministry of

commerce, RBI bullet in,etc….the collected data from this source have been complied and used with

due care. Other publications and magazines were also used to obtain relevant information‟s EXIM

times, the management accountant, journal of international marketing, international journal of market

research.

SAMPLE DESIGN

The study is made for the purpose of an in depth analysis of various indicators and its effect

on export of foreign trade with developing countries. The data for the study is selected based on the

availability in order to execute uniformity, the parameter export data year wise is collected from 2010

to 2014.

TOOLS AND TECHNIQUES

Trend Analysis

Growth Rate

PERIOD OF THE STUDY

The study covers a period of 10 years ranging from 2004 to 2014.

AREA OF THE STUDY

The Study area is Chosen by RBI Statistics handbook.



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LIMITATIONS OF THE STUDY

The study is limited only to impact of trade liberalisation of exports of manufacturing

industries in India. Period of the study limited to ten years only.

The data used in this study are secondary in nature as given in RBI Statistics handbook.

REVIEW OF LITERATURE

Dr. Raj Kumar Gautam (2012), “Liberalization Impact on Indian Small Industries: An

Empirical Study of Punjab”, The aim of the paper is to study the impact of liberalization on the

Indian Small-Scale Industry in the leading industrial state of Punjab. To ascertain the overall impact

of liberalization on the performance of selected small sector units manufacturing textiles, bicycle and

bicycle parts, food products and beverages and leather and leather products.Kruskal-Wallis test has

been applied to know the significant differences among the respondents relating to different

industries, age and turnover groups with respect to these statements. The test has been applied at

assumed p-value =0.05. The statements with less than 0.05 p-value are considered significant and

those with p-value more than the assumed value are considered to be insignificant.The findings of the

study indicate that small manufacturers are affected in the liberalized era and facing lot of problems to

run their businesses. It has been observed that units from all surveyed industries irrespective of age

and turnover believed that liberalization has resulted into more competition, increased quality

consciousness, difficulty in marketing, dumping of cheaper goods by other Countries in, reduction in

profit margin and high level of customer satisfaction.

Krishn A Goyal (2006) ,“Impact of Globalization on Developing Countries in With Special

Reference To India”India‟s imports in 2004-05 stood at US$ 107 billion recording an increase of

35.62 percent comparedwith US$ 79 billion in the previous fiscal. Export also increased by 24 percent

as compared to previousyear. It stood at US $ 79 billion in 2004-05 compared with US $ 63 billion in

the previous year. Oil imports zoomed by 19 percent with the import bill being US $ 29.08 billion

against USD 20.59 billion in the corresponding period last year. Non-oil imports during 2004-05 are

estimated at USD 77.036 billion, which is 33.62 percent higher than previous year's imports of US $

57.651 billion in 2003-04.The lesson of recent experience is that a country must carefully choose a

combination of policies that best enables it to take the opportunity - while avoiding the pitfalls. For

over a century the United States has been the largest economy in the world but major developments

have taken place in the world economy since then, leading to the shift of focus from the US and the

rich Countries in of Europe to the two Asian giants- India and China. Economics experts and various

studies conducted across the globe envisage India and China to rule the world in the 21st century.

India, which is now the fourth largest economy in terms of purchasing power parity, may overtake

Japan and become third major economic power within 10 years.

EXPORT PERFORMANCE LIBERALISATION AND GLOBALIZATION OF INDIA

It has been attempted to trace out the overall export performance of Liberalisation and

Globalization in India. The framework of analysis includes,

Trend analysis.

Growth analysis

LIST OF COUNTRIES USED IN THIS STUDY

India's Foreign Trade with OECD Countries



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India's Foreign Trade with OPEC Countries

India's Foreign Trade with Eastern Europe Countries

India's Foreign Trade with Developing Asia Countries

India's Foreign Trade with Developing Saarc Countries

India's Foreign Trade with Developing Asian Developing Countries

India's Foreign Trade with Developing Africa Countries

India's Foreign Trade with Developing Latin American Countries

Indian Oil Export

Indian Non- Oil

Exports of Principal Commodities

Primary Products

Exports of Principal Commodities Manufactured Goods

Exports of Principal Commodities Petroleum Products

Exports of Principal Commodities

Agriculture and Allied Products

Exports of Principal Commodities Engineering Goods

ANALYSIS AND INTERPRETATIONS

TABLE NO: 1

INDIA'S FOREIGN TRADE WITH OECD COUNTRIES

(` in billion) (` in billion)

Year Exports (`) Growth (`) Year Trend (`) Growth(`)

2010 3,043.09 - 2015 7,672.244 11.95241

2011 3,797.67 24.79651 2016 8,116.65 5.792386

2012 4,959.69 30.59824 2017 9,380.17 15.56701

2013 5,589.61 12.70079 2018 10,175.7528 8.481539

2014 6,853.13 22.6048 2019 10,643.69 4.598551

Source: RBI handbook Source: Computed

INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with OECD

Countries in Export was Rs. 3,043.09 million and it decreased to Rs. 6,853.13 million in the year of

2014. To find the trend of India‟s foreign trade with OECD Countries in Export. Trend analysis has

been applied from 2015 to 2019. Through Trend analysis it is found that India‟s foreign trade with

OECD Countries in Export has a increasing trend.

TABLE NO: 2

INDIA'S FOREIGN TRADE WITH OPEC COUNTRIES



2010 1,786.18 - 2015 4,242.188 15.71897

2011 2,437.69 36.47505 2016 4,158.19 -1.98006

2012 2,782.91 19.32728 2017 4,590.593 10.39883

2013 3,422.19 22.97164 2018 5,022.996 9.419328

2014 3,665.94 7.122632 2019 5,455.399 8.608468




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INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with OPEC

Countries in Export was Rs.1,786.18 million which is increased to Rs.3,665.94 million in the year of

2014. To find the trend of India‟s foreign trade with OPEC Countries in Export .Trend analysis has

been applied from 2015 to 2019. Through Trend analysis it is found that India‟s foreign trade with

OPEC Countries in Export has a increasing trend.

TABLE NO: 3

INDIA'S FOREIGN TRADE WITH EASTERN EUROPE COUNTRIES



2010 85.08 - 2015 269.774 20.37034

2011 128.19 50.66996 2016 235.77 -12.6046

2012 155.47 21.28091 2017 247.42 4.941256

2013 212.47 36.66302 2018 262.3758 6.044701

2014 224.12 5.483127 2019 259.07 -1.25995


INTERPRETATION

From the above table it is inferred that in the year of 2010 India's foreign trade with Eastern

Europe Countries in Export was Rs.85.08 million which is increased to Rs.2,24.12 million in the year

of 2014. To find the trend of India's foreign trade with Eastern Europe Countries in Export Trend

analysis has been applied from 2015 to 2019. Through Trend analysis it is found that India's foreign

trade with Eastern Europe Countries in Export has a decreasing trend.

TABLE NO: 4

INDIA'S FOREIGN TRADE WITH DEVELOPING ASIA COUNTRIES



2010 2526 - 2015 6,267.299 14.34298

2011 3,192.54 26.38717 2016 6,278.57 0.179838

2012 4,350.93 36.28428 2017 7076 12.70082

2013 4,683.71 7.64848 2018 7,631.9468 7.856795

2014 5,481.14 17.02561 2019 7,873.43 3.16411


INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with Asia

Export was Rs.2,526 million which is increased to Rs.5,481.14 million in the year of 2014. To find

the trend of India‟s foreign trade with Asia Export Trend analysis has been applied from 2015 to

2019. Through Trend analysis it is found that India‟s foreign trade with Asia Export has a increasing

trend.



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TABLE NO: 5

INDIA'S FOREIGN TRADE WITH DEVELOPING SAARC COUNTRIES



2010 396.46 - 2015 1,169.793 11.11256

2011 530.19 33.73102 2016 1,283.48 9.718557

2012 640.48 20.80198 2017 1,514.16 17.97301

2013 822.12 28.35998 2018 1,652.8986 9.162744

2014 1,052.8 28.05916 2019 1,744.84 5.562434


INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with Saarc

Export was Rs.3,96.46 million which is increased to Rs.1,052.8 million in the year of 2014. To find

the trend of India‟s foreign trade with Saarc Export Trend analysis has been applied from 2015 to

2019. Through Trend analysis it is found that India‟s foreign trade with Saarc Export has a increasing

trend.

TABLE NO: 6

INDIA'S FOREIGN TRADE WITH DEVELOPING ASIAN DEVELOPING COUNTRIES



2010 2,129.54 - 2015 5,097.511 15.1111

2011 2,662.35 25.01996 2016 4,995.08 -2.00943

2012 3,710.45 39.36748 2017 5,561.82 11.34596

2013 3,861.6 4.07363 2018 5,979.0242 7.501217

2014 4,428.34 14.6763 2019 6,128.56 2.501007


INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with Asian

Developing Countries in Export was Rs. 2,129.54 million which is increased to Rs. 4,428.34 million

in the year of 2014. To find the trend of India‟s foreign trade with Asian Developing Countries in

Export Trend analysis has been applied from 2015 to 2019. Through Trend analysis it is found that

India‟s foreign trade with Asian Developing Countries in Export has a increasing trend.

TABLE NO: 7

INDIA'S FOREIGN TRADE WITH DEVELOPING AFRICA COUNTRIES



2010 494.23 - 2015 1,864.959 17.03025

2011 723.55 46.39945 2016 1,859.84 -0.27448

2012 982.5 35.78882 2017 2,126.11 14.31682

2013 1,327.3 35.09415 2018 2,313.5228 8.814821

2014 1,593.57 20.06103 2019 2,392.38 3.408534




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INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with Africa

Export was Rs.4, 94.23 million which is increased to Rs.1, 593.57 million in the year of 2014. To find

the trend of India‟s foreign trade with Africa Export Trend analysis has been applied from 2015 to

2019. Through Trend analysis it is found that India‟s foreign trade with Africa Export has a increasing

trend.

TABLE NO: 8

INDIA'S FOREIGN TRADE WITH DEVELOPING LATIN AMERICAN COUNTRIES



2010 305.54 - 2015 973.761 26.64339

2011 459.73 50.46475 2016 741.26 -23.8766

2012 642.8 39.8212 2017 713.62 -3.72879

2013 796.54 23.91724 2018 740.7722 3.804854

2014 768.9 -3.47001 2019 685.98 -7.39663


INTERPRETATION

From the above table it is inferred that in the year of 2010 India‟s foreign trade with Latin

American Countries in Export was Rs. 3,05.54 million which is increased to Rs. 7,68.9 million in the

year of 2014. To find the trend of India‟s foreign trade with Latin American Countries in Export

Trend analysis has been applied from 2015 to 2019. Through Trend analysis it is found that India‟s

foreign trade with Latin American Countries in has a decreasing trend.

TABLE NO: 9

INDIAN OIL EXPORT

(`in billion)

Year Exports(`) Growth(`)

2004 163.97 -

2005 314.04 91.52284

2006 515.33 64.09693

2007 845.2 64.01141

2008 1,141.92 35.10648

2009 1,233.98 8.061861

2010 1,328.99 7.699476

2011 1,887.79 42.04697

2012 2,679.15 41.91992

2013 3,307.9 23.46826

2014 3,802.5 14.95208

Source: RBI handbook

INTERPRETATION

From the above table it is inferred that in the year of 2004 Indian Oil Export was Rs.1,63.97

million which is increased to Rs.3,802.5 million in the year of 2014. Through Trend analysis it is

found that Indian Oil Export has a increasing trend.

Year Trend(`) Growth(`)

2015 3,689.08 -2.98285

2016 4,386.53 18.90598

2017 4,948.21 12.80453

2018 5,509.88 11.35108

2019 5,843.01 6.045972

(` in billion)

Source: Computed



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TABLE NO: 10

INDIAN NON- OIL EXPORT

(` in billion)


2004 2,769.69 -

2005 3,439.35 24.17816

2006 4,048.85 17.72137

2007 4,872.59 20.34504

2008 516.72 -89.3954

2009 7,173.57 1288.29

2010 7,126.35 -0.65825

2011 9,541.43 33.88944

2012 11,980.45 25.56242

2013 13,035.29 8.804678

2014 15,139.32 16.14103


INTERPRETATION

From the above table it is inferred that in the year of 2004 Indian Non-Oil Export was Rs.

2,769.69 million which is increased to Rs. 15,139.32 million in the year of 2014. Through Trend

analysis it is found that Indian Non-Oil Export has a increasing trend.

TABLE NO: 11

EXPORTS OF PRINCIPAL COMMODITIES PRIMARY PRODUCTS

(` in billion)

INTERPRETATION

From the above table it is inferred that in the year of 2004 Exports of Principal Commodities

Primary Product was Rs. 4,55 million which is increased to Rs. 2,914.56 million in the year of 2014.

Through Trend analysis it is found that Exports of Principal Commodities Primary Product has a

increasing trend.


2015 14,875.275 -1.7441

2016 17,243.35 15.91954

2017 19,347.38 12.20198

2018 20,908.632 8.06958

2019 21,451.41 2.59595


2004 455 -

2005 608.97 33.83956

2006 725.08 19.06662

2007 890.78 22.85265

2008 1,109.26 24.52682

2009 1,165.26 5.048411

2010 1,252.34 7.47301

2011 1,496.47 19.49391

2012 2,200.79 47.06543

2013 2,533.39 15.11275

2014 2,914.56 15.04585


2015 2,801.65 -3.87402

2016 3,295.73 17.63535

2017 3,676.9 11.56557

2018 3,864.12 5.091824

2019 4,058.07 5.01922

(` in billion)

Source: Computed

(` in billion)

Source: Computed



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TABLE NO: 12

EXPORTS OF PRINCIPAL COMMODITIES MANUFACTURED GOODS

(` in billion)


2004 2,228.29 -

2005 2,728.72 22.45803

2006 3,212.61 17.73322

2007 3,842.61 19.61022

2008 4,145.99 7.895155

2009 5,664.02 36.61442

2010 5,464.56 -3.52153

2011 7,198.63 31.73302

2012 8,885.99 23.44002

2013 9,954.41 12.02365

2014 11,623.83 16.77066


INTERPRETATION


Manufactured Goods was Rs. 2,228.29 million which is increased to Rs. 11,623.83 million in the year

of 2014. Through Trend analysis it is found that Exports of Principal Commodities Manufactured

Goods has a increasing trend

TABLE NO: 13

EXPORTS OF PRINCIPAL COMMODITIES PETROLEUM PRODUCTS

(`in billion)


INTERPRETATION


Petroleum Products was Rs. 1,63.97 million which is increased to Rs. 3,802.5 million in the year of

2014. Through Trend analysis it is found that Exports of Principal Commodities Petroleum Products

has a increasing trend.


2015 11409.85 -1.84085

2016 13293.25 16.50676

2017 14962.67 12.5584

2018 15558.77 3.983938

2019 16632.09 6.898464


2015 3,689.08 -2.98285

2016 4,386.53 18.90598

2017 4,948.21 12.80453

2018 5,509.88 11.35108

2019 5,843.01 6.045972


2004 163.97 -

2005 314.04 91.52284

2006 515.33 64.09693

2007 845.2 64.01141

2008 1,141.92 35.10648

2009 1,233.98 8.061861

2010 1,328.99 7.699476

2011 1,887.79 42.04697

2012 2,679.15 41.91992

2013 3,307.9 23.46826

2014 3,802.5 14.95208

(` in billion)

Source: Computed

(` in billion)

Source: Computed



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TABLE NO: 14 -

EXPORTS OF PRINCIPAL COMMODITIES AGRICULTURE AND ALLIED PRODUCTS

(` in billion)

INTERPRETATION


Agriculture and Allied Products was Rs. 3,46.16 million which is increased to Rs. 2,575.59 million in

the year of 2014. To find the trend of Exports of Principal Commodities Agriculture and Allied

Products Trend analysis has been applied from 2015 to 2019. Through Trend analysis it is found that

Exports of Principal Commodities Agriculture and Allied Products has a increasing trend.

TABLE NO: 15

EXPORTS OF PRINCIPAL COMMODITIES ENGINEERING GOODS

(` in billion)

INTERPRETATION


Engineering Goods was Rs. 5,70.05 million which is increased to Rs. 4,207.27 million in the year of

2014. To find the trend of Exports of Principal Commodities Engineering Goods Trend analysis has

been applied from 2015 to 2019. Through Trend analysis it is found that Exports of Principal

Commodities Engineering Goods has a increasing trend.


2004 346.16 -

2005 380.78 10.00116

2006 452.2 18.75624

2007 573.92 26.91729

2008 742.09 29.30199

2009 806.49 8.678193

2010 841.36 4.323674

2011 1,102.96 31.09252

2012 1,795.83 62.81914

2013 2,227.42 24.0329

2014 2,575.59 15.63109


2015 2,370.72 -7.95412

2016 2,979.37 25.67353

2017 3,369.25 13.08597

2018 3,759.13 11.5717

2019 3,964.51 5.463342


2015 4,206.00 -0.03029

2016 4,628.21 10.03839

2017 5,106.485 10.33391

2018 5,584.76 9.366032

2019 5,951.49 6.566591


2004 570.05 -

2005 779.49 36.74064

2006 961.57 23.35886

2007 1,337.9 39.13704

2008 1,504.35 12.44114

2009 2,174.82 44.56875

2010 1,815.72 -16.5117

2011 2,648.91 45.88758

2012 3,250.72 22.71916

2013 3,556.99 9.421605

2014 4,207.27 18.28175

(` in billion)

Source: Computed

Source: Computed

(` in billion)





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FINDINGS

Export wise

In the year of 2012 the export of India‟s foreign trade with OECD Countries highest growth

rate for (30.59824). Through Trend analysis it is found that India‟s foreign trade with OECD

Countries in Export has a increasing trend.

In the year of 2011 the export of India‟s foreign trade with OPEC Countries highest growth

rate for (36.47505). Through Trend analysis it is found that India‟s foreign trade with OPEC

Countries in Export has a increasing trend.

In the year of 2012 the export of India‟s foreign trade with Asia highest growth rate for

(36.28428). Through Trend analysis it is found that India‟s foreign trade with Asia Export has

a increasing trend.

In the year of 2011 the export of India‟s foreign trade with Saarc highest growth rate for

(33.73102). Through Trend analysis it is found that India‟s foreign trade with Saarc Export


In the year of 2012 the export of India‟s foreign trade with Asian Developing Countries

highest growth rate for (39.36748). Through Trend analysis it is found that India‟s foreign

trade with Asian Developing Countries in Export has a increasing trend.

In the year of 2011 the export of India‟s foreign trade with Africa highest growth rate for

(46.39945). Through Trend analysis it is found that India‟s foreign trade with Africa Export


In the year of 2011 the export of India‟s foreign trade with Latin American Countries growth

rate for (50.46475). Through Trend analysis it is found that India‟s foreign trade with Latin

American Countries in has a decreasing trend.

In the year of 2005 the export of Indian Oil highest growth rate for (91.52284). Through

Trend analysis it is found that Indian Oil Export has a increasing trend.

In the year of 2009 the export of Indian Non-Oil highest growth rate for (1288.29). Through

Trend analysis it is found that Indian Non-Oil Export has a increasing trend.

In the year of 2005 the Exports of Principal Commodities Primary Product highest growth

rate for (33.83956). Through Trend analysis it is found that Exports of Principal Commodities

Primary Product has a increasing trend.



Manufactured Goods has a increasing trend.

In the year of 2004 the Exports of Principal Commodities Petroleum Products highest growth


Petroleum Products has a increasing trend.

In the year of 2012 the Exports of Principal Commodities Agriculture and Allied Products

highest growth rate for (62.81914). Through Trend analysis it is found that Exports of

Principal Commodities Agriculture and Allied Products has a increasing trend.



Engineering Goods has a increasing trend.



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SUGGESTIONS

To face the challenges from the unfavorable policies and to get benefits from the favorable

policies, the Government should start more cluster units, mini industrial parks, industrial

societies and special economic zones for micro and small industries products, give more

assistance to exporters and industrialists to get national and international quality mark

certification, build geographical and common brand name, coordinate all small industrial

promotional agencies, strengthen export promotion councils and commodity boards, start

more design and fashion technology institutes etc.

The Impact of globalization on the Indian economy are wide and could be seen from several

angles such as internal and external trade, production, consumption and distribution, overall

and sector wise performance, social, economical, political and cultural impacts, and macro

and micro level impacts.

It may be concluded that the response of the Indian industry to the changes in the economic

policy has been reasonably good.

Further, in order to reach greater heights, greater autonomy especially for public enterprises is

necessary for industry to operate in the new economy.

Relaxation of bureaucratic controls is necessary for unshackling industry, attainment of self-

sustained growth with social justice.

The real solution to the challenges faced by the industry is the shift in the basic character of

the industry from less competition to more competition, less quality to the fair quality,

primitiveness to modernity and above all from low ethics to good governance.

CONCLUSION

To sum up, we can say that liberalization and globalization are to be viewed specially in the

perspective of National requirements and progress. Unqualified and unlimited liberalization and

globalization will lead to an utter economics. But unfortunately in many of the countries, this is what

is happening. Therefore, liberalization, though of the hour, is not to be taken for granted to any extent

in a country, much less in India where at least two thirds of the population of the country still depend

for its livelihood on agriculture, let us not forget that both the concepts of liberalization and

globalization have started from the West to serve their own interests. We, Indians, on our part, will

adopt both these concepts to the extent to which they are beneficial to our economy.

REFERENCE

Goyal K A. & P.K.Khicha, “Globalization of Business: Future Challenges”, Third concept,

An International Journal of Ideas.

Ojha. A.K. , Globalization & Liberalization – prospects of new world order, Third concept-

An International Journal of Ideas, August-2002.

Government of India, Planning Commission, 1992. Eighth Five Year Plan, 1992-97 New

Delhi. And Tenth Five Year plan 2002-07

Jalan, Bimal 1996. India‟s Economic Policy: Preparing for the Twenty-First Century. Penguin

Books, New Delhi.

Child, john and David K. Tse, China‟s Transition and its Implications for International

Business”, Journal of International Business studies, Volume 32 Number 2001.



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