NCERT Solutions for Class 10 Economics Chapter 4 Globalisation and the Indian Economy

NCERT Solutions for Class 10 Social Science Economics Chapter 4 Globalisation and the Indian Economy are provided here. With these solutions, you will learn the right way to write answers to the questions perfectly in exams. We have updated the NCERT Solutions for Class 10 Economics Chapter 4 Globalisation and the Indian Economy for the current session so that you can easily score high marks in the exams. You can also download PDF of the solutions and use them whenever you are offline.

Class 10 Social Science Economics Chapter 4 NCERT Solutions

Question 1. What do you understand by globalisation? Explain in your own words.

Answer: Globalisation means integrating the economy of a country with the economies ofother countries under conditions of free flow of trade, capital and movement of persons across borders. Globalisation is the process of interaction and integration between people, companies, and governments worldwide. Globalization has grown due

to advances in transportation and communication technology. It includes

  • Increase in foreign trade
  • Export and import of techniques of production.
  • Flow of capital and finance from one country to another
  • Migration of people from one country to another.

Question 2. What were the reasons for putting barriers to foreign trade and foreign investment by the Indian government? Why did it wish to remove these barriers?

Answer: The main reason for putting barriers to foreign trade and foreign investment by the Indian government was to protect the interest earned by producers and small industrialists of our country from foreign competition.

But later it was accepted by the government that foreign competition would encourage Indian industrialists to improve the quality of their products and removing these barriers would increase trade and quality of products produced in the country.

Question 3. How would flexibility in labour laws help companies?

Answer: Flexibility in labour laws will help companies in being competitive and progressive.By easing up on labour laws, company heads can negotiate wages and terminate employment, depending on market conditions. This will lead to an increase in the company’s competitiveness. The government has also allowed flexibility in labour laws to attract foreign investment. The government has allowed companies to ignore many of the labour laws. Instead of hiring workers on a regular basis, companies hire workers flexibly for short periods when there is intense pressure of work. This helps to reduce the cost of labour for the company.

Question 4. What are the various ways in which MNCs set up, or control, production in other countries?

Answer: Multinational Corporations (MNCs) set up their factories or production units closeto markets where they can get the desired type of skilled or unskilled labour at low costs along with other factors of production. After ensuring these conditions MNCs set up production units in the following ways:

  • MNCs are setting up partnerships with local companies.
  • Buy the local companies and then expand its production with the help of modern technology.
  • They place orders for small producers and sell these products under their own brand name to the customers worldwide.
  • MNCs are taking over local companies with their immense money power. Through the above ways, MNC’s are exerting a strong influence on production at distant locations.

Question 5. Why do developed countries want developing countries to liberalise their trade and investment? What do you think should the developing countries demand in return?

Answer: Developed countries want developing countries to liberalise their trade and investment because then the MNCs belonging to the developed countries can set up factories in less-expensive developing nations, and thereby increase profits, with lower manufacturing costs and the same sale price. In my opinion, the developing countries should demand, in return, for some manner of protection of domestic producers against competition from imports. Also, charges should be levied on MNCs looking to set base in developing nations.

Question 6. “The impact of globalisation has not been uniform.” Explain this statement.

Answer: The impact of globalisation has not been uniform because it has benefitted only the rich and developed countries. The developing countries are only a source of setting industries and getting cheaper labour and the entire profits are earned by the developed countries. Many small manufacturers with low capital have not been able to withstand the competition from the large MNC’s. Workers are now employed flexibly in the face of growing competition. This has reduced their job security.

Question 7. How has liberalisation of trade and investment policies helped the globalisation process?

Answer: The liberalisation of trade and investment policies helped the globalisation process because it has helped in the removal of trade barriers. It has made foreign trade and investment easier. The choices of the buyers have also expanded, as now they get to choose products manufactured by not only domestic companies but also by the foreign companies. Competition among traders has resulted in the cheaper price of products. Liberalisation has spread globalisation as the decision making power of export and import now lies with the businessmen themselves.

Question 8. How does foreign trade lead to the integration of markets across countries? Explain with an example other than those given here.

Answer: Foreign trade provides opportunities for both producers and buyers to reachbeyond the markets of their own countries. Goods travel from one country to another. Competition prevails among producers of various countries as well as buyers across the world. Therefore foreign trade leads to the integration of markets across countries.

For example during Diwali season buyers in India have the option of choosing between Indian and Chinese decorative lights and bulbs. This provides an opportunity for the sellers to expand their business. With the liberalisation of foreign trade, electronic goods like digital cameras, laptop, smartphones have flooded the Indian market and give good opportunities to the buyer to select the item of their choice.

Question 9. Globalisation will continue in the future. Can you imagine what the world would be like twenty years from now? Give reasons for your answer.

Answer: Twenty years down the line the world would undergo a positive change which willpossess the following features— healthy competition, improved production efficiency, increased volume of output, income, and employment, better living standards, greater availability of information and modern technology. These are the favorable factors for globalisation :

  • Availability of human resources both quantity wise and quality wise will increase.
  • Broad resource and industrial base of major countries.
  • Growing entrepreneurship.
  • Growing domestic market.
  • Expanding internal markets
  • Economic liberalisations.
  • Growing competition.

Question 10. Supposing you find two people arguing: One is saying globalisation has hurt our country’s development. The other is telling, globalisation is helping India develop. How would you respond to these arguments?

Answer: Benefits of globalisation of India are as follows:

  • Increase in the volume of trade in goods and services
  • The inflow of private and foreign capital and export orientation of the economy.
  • Increase the volume of output, income, and employment.
  • More availability of investable funds in the form of FDI.
  • Helps in developing and strengthening the domestic economy of India.
  • Improved productive efficiency and healthy competition.

Negative Impact/Fears of Globalisation on Indian economy:

  • It may not help in achieving sustainable growth.
  • It may lead to the widening of income inequalities among people of the country.
  • It may lead to aggravation of income inequalities within countries.
  • It may lead to greater dependence of the underdeveloped countries on devoloped country.

Whatever may be the fears of globalisation, I feel that it has now become a process which is catching the fancy of more and more nations. Therefore we must become ready to accept globalisation with grace and also maximize economic gains from the world market.

Question 11. Fill in the blanks.

Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of _______. Markets in India are selling goods produced in many other countries. This means there is increasing ______ with other countries.

Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India because of ______. While consumers have more choices in the market, the effect of rising ______ and ______ has meant greater ____ among the producers.

Answer:  Indian buyers have a greater choice of goods than they did two decades back. This is closely associated with the process of globalisation. Markets in India are selling goods produced in many other countries. This means there is increasing trade with other countries.

Moreover, the rising number of brands that we see in the markets might be produced by MNCs in India. MNCs are investing in India Because of the cheaper production costs. While consumers have more choices in the market, the effect of rising demand and purchasing power has meant greater competition among the producers.

Question 12. Match the following.

(i) MNCs buy at cheap rates from small(a) Automobiles producers
(ii) Quotas and taxes on imports are used to regulate trade items(b) Garments, footwear, sports
(iii) Indian companies who have invested abroad(c) Call centres
(iv) IT has helped in spreading of production of services(d) Tata Motors, Infosys, Ranbaxy
(v) Several MNCs have invested in setting up factories in India for production(e) Trade barriers

Answer:

(i) MNCs buy at cheap rates from small producers(b) Garments, footwear, sports items
(ii) Quotas and taxes on imports are used to regulate trade(e) Trade barriers
(iii) Indian companies who have invested abroad(d) Tata Motors, Infosys, Ranbaxy
(iv) IT has helped in spreading of production of services(c) Call centres
(v) Several MNCs have invested in setting up factories in India for production(a) Automobiles producers
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