Download - India's Globalization
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India's
GlobalizationBy:
Lara Mejia Alejandro
Luis Raul Lopez Rubio
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India's Globalization
India contains about a fifth of the
population of the developing world;
indeed, some of its constituent states
have larger populations than most
developing countries. The study brings to
bear abundant quantitative and
qualitative data on the analysis.
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India's Globalization
The study delineates three broad periods in
Indias recent economic history:
(1) the period prior to liberalization (195657through 197475), characterized as one of
autarky and command and control
economy;
(2) the period of intermittent incrementalliberalization(197576 through 199091); and
3) the period after the paradigm shift to an
outward-oriented economic policy in 1991.
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India's Globalization
The study finds that, whatever the
consequences of globalization elsewhere
in the developing world, the case of the
critics has little merit when examined in
relation to the Indian experience. The
Indian case does not bear out the
predictions of the critics.
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India's Globalization
1. Instead of economic stagnation, India
has seen acceleration in its average
annual rate of economic growth, from 3.4
percent in the pre-globalization period to
about 6 percent. That figure may soon
reach 7 percent.
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India's Globalization
2. Instead of deindustrialization, there hasbeen industrial growth and, indeed,
acceleration in the industrial growth rate.The average annual rate of industrial growthhas jumped from 5.2 percent during theperiod of autarky to 7.0 percent after 1991.
At the last rate, the value of manufacturingdoubles about every ten yearsnot exactlydeindustrialization.
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India's Globalization
3. Instead of denationalization, business in
India is now more competitive and is
venturing forth into the global market.
Increased imports and the entry of foreign
multinationals have not swamped it.
Essentially, India is master of its own
economy.
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India's Globalization
4. Instead of economic destabilization,the globalization of Indias economy has
led to fewer economic crises. The periodof economic autarky before globalizationwas essentially one long, enduring crisis.Since the paradigm shift to economic
liberalization in 1991, there has been amarked absence of economic crisis inIndia.
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India's Globalization
5. Instead of impoverishment, India hasseen a long and unprecedented period
of welfare enhancement. The periodbefore globalization featured high levelsof poverty. There has been a seculardecline in poverty since 1975and
inequality has not increased much. Ofmore concern is the matter of growingregional disparities in India.
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India's Globalization
India has been a significant beneficiary of
the globalization process. Rather than
support the case of the critics, Indias
experience strongly repudiates those
critics.
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India's Globalization
The policy conclusion that flows from the
experience is that India should, in general,
be more open to globalization in the
interest of sustaining the acceleration in
growth and, therefore, the welfare of its
people.
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India's Globalization
The agenda for reform to this end is well-
established in the reform community.
What is required is more energetic action
to implement it, but there are, of course,
constraints in doing so that are built into
the larger political system.