Globalization and Role of the State


By

Ms. Jyoti Srivastava
Lecturer
Kailashi Devi Sharwan Kumari Degree College
Jalaun

Dr. Jaishree Purwar
Reader
D.V. College
Orai
 


Though the opponents of globalization fear of the negative consequences of globalization, the proponents argue that, it is only a short run phenomenon. In the long run, the process of globalization results in the overall development of the entire world. But role of the state is very important to take advantages from globalisation.

Globalisation means integration of economies and societies through cross-country flows of information, ideas, technologies, goods, services, capital, finance and people. International Monetary Fund defines" globalisation as the growing economic interdependence of countries worldwide through increasing volume and variety of cross border transactions in goods and services and of international capital flows and also through the more rapid and widespread diffusion of technology".

Globalization has its plus and minus. The Indus civilization had one of the most globalized economies of that time. Some cities specialized in the production of copper, others in beads and textiles-all meant for the export markets.  Once again the period of Gupta Empire saw huge exports from India. India is known as the 'golden bird' though little gold is found in the country. The wealth of India in the past may be said to be substantially due to our having adopted an outward oriented trade policy. Globalization is, so to say, in our blood.  But the present globalization is qualitatively different that that of the past. Issues such as intellectual property rights, investment, and labour and environment standards have been, or are being, brought under the ambit of WTO.

Role of state in the Globalisation

Countries can take advantages from globalisation as following ways:

Making a competitive environment domestically

State must dismantle trade barriers to take full advantage of wider market access. There is need of enactment of some legislation to protect various sectors such as agriculture.

Improvement in infrastructure:

The state should continue to concentrate heavily on infrastructure development. Timely implementation and financing are two important issues in infrastructure development. In the pre-liberalization period, the government provided all the key infrastructure services. Conversely, in reform era there has been a need to involve private sector.

Attention towards agriculture sector

Investment in agriculture sector in the form of irrigation facilities, rural electrification, construction of roads, drinking water supply etc, must take place for improving productivity in the agriculture sector. This will also enhance spending ability of rural consumers.

Need of balanced development:

There is apparently need of balanced development in any economy. All sections of economy should mark together in unison. There is need to be realized that industrial growth too is dependent on agriculture growth. Every rise and fall is reflected in next year's industrial growth. Because industrial demand is based on consumer demand and which in turn is based on purchasing power of rural sector. Main source of income in rural sector is agriculture; therefore stagnation of agriculture will hurt growth of economy. 

Need of investment in employment intensive sectors

Government must encourage investment in employment intensive sectors that have high multiplier effect on employment like commercial energy and roads.

Need of proper channelization of resources: 

Poor are living in destitution condition and lacking basic needs of life. Government must give attention on fields such as education, health service, infrastructure, and public sector management. Therefore, common man can take viable advantage of globalisation

For taking advantages from globalization, developing countries must have proper economic, political institutions in place. There are many countries, those unable to adopt the above reforms like Democratic Republic of Congo, Kenya, Tanzania, Haiti, and Sierra Leon. Conversely, there are some impressive examples of countries once considered undeveloped, like China and Japan. Therefore, globalization can be helpful when used in conjunction with sound domestic economic policies.

References

* Dutt & Sunduram (1999) "Indian Economy" New Delhi: S. Chand.
* Francis Cherunilum (1999)" Business Environment" New Delhi: Himalaya
* Singh Bhanu Pratap (2002) Unbalanced Development The Hindu, October 4.
 


Ms. Jyoti Srivastava
Lecturer
Kailashi Devi Sharwan Kumari Degree College
Jalaun

Dr. Jaishree Purwar
Reader
D.V. College
Orai
 

Source: E-mail September 2, 2008

           

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