THE POSITIVE AND NEGATIVE IMPACTS OF GLOBALIZATION

Globalization has had far reaching consequences to both the people living in India and the economy in general. Defining what is meant by globalization is important in the assessment of its advantages and disadvantages to India. This is particularly crucial since the exclusion of those who clearly support the phenomenon in its present form, that is, those who believe that globalization has many advantages and that these advantages will automatically be felt by the poor, also hold various and divergent views concerning this process. People, who are opposed to globalization or those concerned with its possible detrimental impacts on employment and poverty, constitute a wide political spectrum. It has been opposed from the perspective of economic and cultural nationalism by the extreme Right while liberals on the other hand are concerned about the loss of national sovereignty since globalization minimizes the effectiveness of the government to intervene in the regulation of labor and capital, eradicate poverty, among other things (Hensman 2000). There are numerous meanings attached to the term globalization. These largely depend on the context and the individual whom is making reference to the term. Even though there is no definite meaning or definition of the term currently, there are some definitions that are worth mentioning. According to Guy Brainbant, the process of globalization encompasses the opening up of world trade, the establishment of advanced communication methods, financial market internalization, increased importance of multinational companies, the migration of populations, increased mobility of people, goods, ideas, capital, pollution, data, diseases and infections. The term not only refers to the integration of global economies through unrestricted trade and financial flows but also exchanges in knowledge and technology. Globalization also includes unrestricted movement of labor between countries. Within the context of India, globalization means that the economy is being opened up to direct foreign investment by making facilities available to the foreign companies so that they may invest in various sectors of economic activities in India, clearing of obstacles and constraints to the entry of multinational companies in India, allowing collaboration between Indian and foreign companies and also encouraging the Indian companies to take part in foreign ventures.

This increased integration of societies and economies around the world has raised much concerns and praise at the same time. The phenomenon has affected the Indian society in both positive and negative ways. Among the positive aspects of globalization are the rapid growth and the reduction of poverty in India. However, it has also generated significant opposition internationally over concerns that it has resulted in increased inequality and the degradation of environment. Globalization in India can be traced back to when it opened up its economy during the nineteen nineties following a major financial crisis. More particularly, India took the first step to globalization when its currency was devalued against other major international currencies by 18-29 percent. The Indian economy was dragged to near defaulting on loans by the crisis which resulted in a slew of domestic and sector policy measures. This was to some degree prompted by the demands of the multilateral organizations and the immediate needs of the country. The new policy regime pushed for an open and more market oriented economy that had far reaching impacts, both positive and negative.

Advantages of globalization
There are numerous implications of globalization on the national economy. The phenomenon has intensified competition and interdependence between economies in the global market. In India, the economic reforms have resulted in the overall economic growth. The growth in the Gross Domestic Product has improved the global position of India. The direction of growth has also been shifted within the sectors. Initially, the primary sector generated a large percentage of the GDP. Due to globalization, the service sector is now the main driver of Indian economy. The overall rate of growth of India’s economy is one of the major advantages of globalization in India owing to the fact that during the 1970s, its rate of growth was as low as 3 percent. Countries like Mexico, Brazil, Korea and Indonesia had their GDP doubling that of India. Even though the 1980s saw the India’s growth rate doubling, it was still lower than that of Indonesia, China and Korea. As such, India’s position in the global arena has been improved from the time that it became part of the globalized world. In 1991, India was ranked fourth with regard to its economy. However, with the increase in the rate of growth that it experienced with the liberalization of its economy, it moved to the fourth place in 2001 (Pieterse 2004). Foreign direct investment has also increased due to globalization in India. There are also other sectors that have experienced growth owing to globalization apart from the above mentioned area. These include India’s imports and exports. As such, globalization has resulted in fiscal consolidation, growth in foreign exchange reserve, increased foreign investment and to a considerable extent, control of inflation. All these have helped the speeding up of growth of Indian economy. Globalization has seen an increase in the number of fortune companies in India. The implication is that there are more employment opportunities than before. This also means that the standards of living have been raised with more wealthy people being created due to the numerous opportunities that exist within the country. The liberalization of trade which consequently led to flexibilities in business policies to allow for equal opportunities for multinational companies has therefore resulted in desirable impacts for the overall Indian economy. New technologies and products have been introduced in India and this has created new opportunities. The multinational companies have made big investments and set up research and development centers which have brought about positive impacts in the lives of Indian people. As a result, India is among the lading countries in information technology, business processing and research and development investments. Globalization has also had positive impacts on the social and cultural realm. By opening new opportunities for employment, globalization has improved both economic and social life of individuals. The standard of living has been raised and more Indians can now enjoy the luxuries that were not known to them before. The perceptions of ordinary Indians have also been changed through increased cultural interaction through mediums. Indian companies are now gaining more recognition in the global arena than before. Products from other parts of the world are also finding their way into the Indian market with more people being in a position to purchase them owing to improved economic conditions. More Indians can also access goods from other parts of the world owing to reduced prices. Generally, globalization has improved the economic life of Indians due to more job opportunities as people are no longer worried about government jobs; there are numerous multinational companies that pay more attractive salaries than the government. As such, Indians have gained more from globalization in ways that are beneficial to both the state and the individuals within the state.

Disadvantages of globalization in India
As much as there have been numerous economic gains attached to globalization in India, there are also disadvantages. The rapid growth of industries due to globalization has not brought about benefits for everyone. There are various sectors that this growth has further aggravated the conditions of particular groups within the Indian society. Globalization has brought about rapid growth in the informal sector which has resulted in undesirable impacts on the working population. As much as it has led to the creation of jobs for many individuals, globalization is also contributing to the suffering of people within the informal sector. It is important to note that the informal sector is deliberately not included in the labor legislation. For instance, informal workers are not subject to the 1948 Factories Act which covers the general working conditions, working hours, safety and health, prohibition of child labor, basic amenities among other things (Stone 1996). With globalization finding its way into India, it is clear that its consequences have been undesirable for workers in the informal sector.  Globalization has resulted in poor health, deplorable working conditions and bondage. Employers have been able to impose working conditions that are extremely hazardous due to chronic insecurity among worker. For instance, the construction industry which is the second largest employer in Indian has not taken into consideration the working conditions of its employers. The employers are not concerned about the hazards involved. The proportion of fatal accidents is very high with some of the causes of serious injuries and deaths being crushes under collapsing structures, electrocution, and being buried under mud (Menon 1999). As such, the plight of workers under globalization has been miserable. The fish processing industry also expresses the grave consequences of globalization. The migrant women who work in this industry are subjected deplorable work conditions. They are virtually captives, forced to work in unhygienic conditions for long hours deprived of minimum wages, and subjected to various kinds of coercion including being sexually harassed (Goyal 2006). The negative impact of globalization is also felt in the Indian agricultural sector. A great number of laborers in this sector come from the ‘Scheduled Castes and Tribes’. In other words, they are from communities that are most exploited economically and oppressed socially under the caste system. The plight of this population has been worsened by globalization owing to the need to increase production to meet the growing demand from the global markets. As such, globalization has resulted in increased poverty and difficulties among particular populations in the Indian society. It has led to forced labor since employers are using crude methods to enforce bondage on the workers. All this is done with the aim of increasing production while at the same time cutting costs. Human beings have been turned into machines simply because of the need to increase profits and be competitive in the global market. This form of ‘slavery’ is especially rampant in the rural regions even though not exclusive to it. The export production has also seen an increase in child labor since liberalization (Vivekanandan 1996). More children have been forced to work in industries even though it is clear that children are not supposed to work. It is only in India where children are forced to work for long hours and under deplorable conditions even though there are legislations that are meant to protect children from any form of labor. From the above mentioned cases, it is clear that as much as globalization has resulted in economic gains for India, the people who work in the industries are wallowing in extreme poverty apart from being subjected to deplorable working conditions. As such, it may be argued that globalization has only resulted in gains for the rich industrialists and multinationals while the bulk of the population is languishing in poverty. What it has done is to increase the gap between the rich and the poor to levels that cannot be imagined. From this perspective, globalization has worsened the conditions of individuals who are at the bottom of the social ladder. On a broader perspective, globalization has led to low-income groups being increasingly undernourished due to the failure not only to create more jobs but also to improve the working conditions for this population. Apart from these impacts on particular groups, globalization has also contributed to the destruction of the environment through pollution and clearing of vegetation cover. With the construction of companies, the emissions from manufacturing plants are contributing to environmental pollution which further affects the health of many individuals. The construction also destroys the vegetation cover which is important in the very survival of both humans and other animals.

Globalization has had both desirable and undesirable consequences for India. These consequences have been felt from the general economy to more specific conditions of life for the individual. As mentioned, globalization has resulted in the growth of Indian economy which in turn has improved the lives of many people. It has also created many employment opportunities. However, it has also widened the gap between the rich and the poor part from resulting in more oppression for those at the bottom of the social ladder. However, it may be said that globalization is inevitable in the twenty first century despite these disadvantages considering the advances in information technology which has led to more integration between nations. Various ills such as inequality that it has created are also some of its inevitable consequences which results from the competitive environment and the need to increase production so as to meet the growing global demand. As such, it has created both winners and loser in India with loses being workers in the informal sector.

4 comments:

P K Menon said...

very helpful article

Unknown said...

very help full for my assignment thanks

Unknown said...

thanks for my question answer and very helpful

Unknown said...

Very help full
Thank you

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