Advocacy of Globalisation:
In support of the movement for globalisation, the following arguments are put forth:
i) Globalisation promotes foreign direct investment and, thus, it enables developing countries to raise capital without incurring international indebtedness.
ii) Globalisation helps developing countries to make use of and adapt technologies developed by advanced countries without undertaking heavy expenditures in Research and Development (R&D).
iii) Globalisation widens the access of developing countries to export their goods and services to developed countries. Similarly, globalisation enables consumers in developing countries to acquire quality consumer goods, especially consumer durables, at relatively much lower prices.
iv) Globalisation implies faster diffusion of knowledge and, thus, it enables developing countries to attain international standards of production and productivity.
v) Globalisation by reducing tariffs and quantitative restriction increases the share of foreign trade as a per centage of GDP.
In brief, the advocates of globalisation consider it as the engine of growth, technological advancement, raising levels of productivity, enlarging employment and bringing about poverty reduction with modernisation. In nutshell, globalisers are of the view that import substitution path of development is restrictive and instead, economies for their growth and technical advancement should promote export-led growth. India has opted for the strategy of export-led growth during the last 15 years. Consequently, exports as a per centage of GDP have gone up from 5.8 per cent in 1990-91 to 11.1 per cent in 2004-05. Along with this, imports have also gone up from 8.8 per cent of GDP to 13.8 per cent during the sameperiod. Similarly, foreign direct investment flows which were a mere trickle in1990-91 of the order of $97 million shot up to $6,130 million in 2003-04. Anothermajor benefit of globalisation has been the sharp increase in the export of invisibletems, especially software exports. A unique achievement of globalisation is thencrease of our net software export earnings to a level of $23.4l billion in2003-04. There is no doubt that India has started thinking in terms of reachingnternational standards in productivity and thus competing effectively in the global market.