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<ul><li><p>International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 Volume 4, No. 6, June 2015 </p><p>i-Explore International Research Journal Consortium www.irjcjournals.org </p><p>83 </p><p>Globalization and Liberalization - Emerging Issues and </p><p>Challenges </p><p> Sonika, Assistant Professor, Om Institute of Technology and Management, Hisar, Haryana </p><p>Anu Rani, Assistant Professor, Govt. P. G. College, Bhiwani, Haryana </p><p>ABSTRACT Globalization can be seen as one of the most important </p><p>force impacting on the economyGlobalization means </p><p>economic Globalization of economy of a country and it </p><p>exert pressure on the government to become more publicly </p><p>accountable, competitive and responsive to citizens. The </p><p>UN document defines Globalization as increased and </p><p>intensified flows between countries. These flows are of </p><p>goods, services, capital, ideas, information and people, </p><p>which produce national cross-border integration of a </p><p>number of economic, social and cultural activities. The </p><p>primary objective of liberalization is to free from the </p><p>restrictions on production, expansion and following of </p><p>rigid rules and regulations. This paper attempts to </p><p>examine the issues and challenges of Globalization and </p><p>liberalization on Indian economic growth and </p><p>development. The increase of multinational companies is </p><p>one of essential features of economic Globalization; a part </p><p>of the document is devoted to the consideration of their </p><p>role in this process. At the end this document, the expected </p><p>future challenges in that process are presented. </p><p>Keywords Globalization, global economy, aspects of Globalization, </p><p>effects of Globalization, dilemmas and challenges. </p><p>1. INTRODUCTION </p><p> The process of liberalization and globalization has </p><p>become a driving force for modern economic development </p><p>throughout the world. Both the developed and the </p><p>developing economies have been initiating suitable reform </p><p>measures in order to make their economies more vibrant </p><p>and strategically competitive.With regard to </p><p>Globalization, we can simply say that today Globalization </p><p>is everything, and everything is Globalization. The current </p><p>issue of our times is so controversial, and everything </p><p>about it becomes a subject of great polarization and </p><p>conflict of rival views. </p><p>However, most authors agree that Globalization is nothing </p><p>new, that it refers to an old process that began more than </p><p>100 years ago (Hirst and Thompson, 1999). The beginning </p><p>of these processes can be related to the second half of the </p><p>nineteenth century, when thanks to technical and </p><p>technological innovation, industrial revolution, the </p><p>importance of transportation, costs were drastically </p><p>reduced and when it came to the first major trade </p><p>liberalization. If we compare this period to the present </p><p>day, we can find much similarity. The first phase of </p><p>Globalization continued until the beginning of World War </p><p>II. Between the two world wars, which marked a major </p><p>economic crisis, the Globalizationprocess was terminated; </p><p>international flow of goods and capital were reduced due </p><p>to the strengthening of protectionism. </p><p>After World War II, the Globalization process was again </p><p>revived, with institutions like the IMF and the GATT on </p><p>the front, acting in the direction of removing trade </p><p>barriers and early use of information technologies. Two </p><p>sources of Globalization accelerated cross-border flow of </p><p>goods and capital. One of them was technological </p><p>progress, which reduced communication costs and </p><p>barriers of time and space that separated national </p><p>markets, and other sources of liberalization. </p><p>2. OBJECTIVES </p><p> 1) To know about the Globalization and liberalization . </p><p>2) To know the process of Globalization and </p><p>liberalization . </p><p>3) To know the impact of Globalization in Indian </p><p>economy . </p><p>4) To know the impact of liberalization on the Indian </p><p>economy . </p><p>5) To know about the advantages of Globalization and </p><p>liberalization . </p><p>6) To provide information about the issue and </p><p>challenges of Globalization and liberalization. </p><p>3. RESEARCH METHODOLOGY </p><p> The data are collected from various sources such as a </p><p>website ,books,magazines, newspaper and other relevant </p><p>publications to know more about the Globalization and </p><p>Liberalization - issues and challenges. </p><p>4. GLOBALIZATION </p><p> Globalization means linking the national economy with </p><p>world economy as an outcome of new economic policy </p><p>which has been adopted in 1991, to accelerate the rate of </p></li><li><p>International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 Volume 4, No. 6, June 2015 </p><p>i-Explore International Research Journal Consortium www.irjcjournals.org </p><p>84 </p><p>economic growth .The globalization emphasized the </p><p>removal of restrictions of licensing, quota and tariffs on </p><p>the export and import of goods across the country. It has </p><p>brought with it new technologies, quality and quantity of </p><p>goods, improved and advanced methods of production and </p><p>increased scope of private sectors, especially the </p><p>multinational corporations in the country, competitive </p><p>environment in the national economy as a mean to </p><p>improve the productivity and efficiency of the system. It </p><p>has encouraged free mobility of the capital and labour with </p><p>increase in the openness, growing economic </p><p>interdependence, deepening economic integration in the </p><p>world economy. </p><p>5. DEFINITION OF GLOBALIZATION </p><p> According to BrittanGlobalization is viewed as a </p><p>whirlwind of relentless and disruptive change which </p><p>leaves governments helpless and leaves a trail of </p><p>economic, social cultural and environmental problems in </p><p>its wake. </p><p>The process of Globalization has given rise to greater </p><p>competition towards markets and investments. Changes </p><p>that are sweeping rapidly across the business world have </p><p>forced businesses and nations to adapt by striving to </p><p>change old economic behaviours and traditional practices. </p><p>The process of Globalization has both positive and </p><p>negative effects to different category of economies of the </p><p>world. Competition among firms to get a good share of </p><p>the large world market leads to; specialization and </p><p>efficiency; better quality products at reduced prices; </p><p>economies of scale in production; technological and </p><p>managerial improvements. </p><p> Developed economies are the main actors of globalization </p><p>since it is about the expansion of markets for goods and </p><p>services. </p><p>As an outcome of globalization, the Government of India </p><p>has to minimize the controls over the flow of foreign </p><p>goods, services, capital, and technology investments and </p><p>has to adopt liberal policies for adjustment of investment. </p><p>The governmental interference in economic activities has </p><p>been declining. The integration of the world market and </p><p>rapid technological change led to efficiency gains and </p><p>growth. These in turn increased competition through lower </p><p>cost and higher market efficiency, higher productivity, </p><p>lower barriers to entry and new investment opportunities </p><p>in public sector. The importance of transparency in the </p><p>governance has been realized and the measures have been </p><p>taken to ensure the participation of masses in </p><p>developmental processes. Globalization provides a useful </p><p>mean to develop technologies necessary for the production </p><p>of goods services that improve the well being of the </p><p>masses. </p><p>World order is rapidly changing due to global structure of </p><p>production, trade and communication. Indian </p><p>administration is facing structural changes due to </p><p>revolution in telecommunication, transportation and </p><p>formation of global financial markets. </p><p>Modern management processes to increase the efficiency </p><p>of the administration have been emphasized. The principle </p><p>of hierarchy has been losing its length and got flattened </p><p>and downsized, and has been eliminating the need for </p><p>levels of bureaucracy and long chain of commands. The </p><p>number of employees has been reducing. Traditional </p><p>administrative processes of file keeping and pushing, </p><p>secrecy in official work, long durations for completion of </p><p>work delays, lengthy processes have been replaced with </p><p>data processing, automation, transparency, speedy services </p><p>with the use of data communication networks. Easy access </p><p>of information about administration helps the people to </p><p>express their views and opinions. Excessive controls on </p><p>administrative activities have been replaced with self </p><p>controls and deregulations. Globalization has introduced </p><p>structural adjustment programmes, government controls </p><p>have been removed over the flow of goods, services, </p><p>capital, technology and investments. As a result, </p><p>government interference in the economic activities has </p><p>been reducing. </p><p>The public choice theory has been emerging as most </p><p>suitable as against the classical and bureaucratic theories </p><p>as up to some extent now people are free to choose the </p><p>alternatives to get the services either from public sector or </p><p>from private sector. The public private collaboration is </p><p>proving today more beneficial in many sectors. Many </p><p>functions of public sectors are being contracted out and </p><p>privatized to provide easy and quick services to common </p><p>masses. Many functions of the bureaucracy are being </p><p>performed by the private and non governmental </p><p>organizations and government is concentrating on </p><p>developmental functions for the underprivileged. </p><p>6. MANAGEMENT PERSPECTIVE OF </p><p>GLOBALIZATION </p><p> Globalization has led to the practice of management across </p><p>culture. Modern business organizations have adopted </p><p>Global management practices. Efforts are being made by </p><p>India to understand Japanese, Chinese style of </p><p>management, Issues in Motivation, communication across </p><p>culture has gained significance. Every functional area of </p><p>management is being studied with a global perspective. </p><p>E.g.: International HRM, International Financial </p><p>management, International marketing etc. </p><p>7. LIBERALISATION </p></li><li><p>International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 Volume 4, No. 6, June 2015 </p><p>i-Explore International Research Journal Consortium www.irjcjournals.org </p><p>85 </p><p>Liberalization and deregulation connote different things to </p><p>different scholars even in the same group. To some it is </p><p>just another name of privatization. To other it meant a </p><p>dilution of Reserve Bank or Finance Ministry control. In </p><p>fact, liberalization involves freeing prizes, trade and entry </p><p>from state controls. Further, free markets do not mean a </p><p>complete way to markets. The degree to which an </p><p>economy is free can be defined by the scope of state </p><p>involvement, either directly by ownership or indirectly by </p><p>regulation, in markets for products or services. </p><p>Liberalization does not mean that each and every player </p><p>should establish offices elsewhere. This is not </p><p>liberalization. In fact, liberalization is a mental attitude. </p><p>Liberalization is a process by which the economy is </p><p>opened up and stringent regulatory measures are relaxed to </p><p>a large extent. Earlier no player ever thought of opening a </p><p>branch in other countries market as there was absolutely </p><p>no role to play in any of those markets. Now everyone has </p><p>acquired a global perspective. </p><p>Liberalization is not simply allowing the foreigners to </p><p>access the vast potential of the Indian market. Actually it </p><p>is concerned with opening of the markets which have </p><p>immense potential, but this perspective is a limited </p><p>perspective and we should go beyond it. We should not </p><p>look at liberalization from that limited perspective, viz. </p><p>opening up the markets. </p><p>Presently in the case of PSBs, there is low productivity, </p><p>low profitability and low morale and it is not possible for </p><p>PSBs to enter the international market and think in the </p><p>terms of doing business internationally. Only by </p><p>improving their functioning PSBs can really equate </p><p>themselves with any international bank and think in terms </p><p>of competing with them in the international market place. </p><p>If they do not change their working style, they cannot </p><p>operate even in their own country as they will be </p><p>swallowed by some strong international banking </p><p>institution in the near future. </p><p>Various drastic changes are taking place the world-over </p><p>and attention has been focused on liberalization and </p><p>deregulation. </p><p>8. OBJECTIVE OF LIBERALISATION </p><p> The main objective is to give a greater role to market </p><p>forces in improving a locative efficiency, removing </p><p>distortions caused by unrealistic pricing, strengthening the </p><p>viability of financial institutions to enable them to </p><p>compete and withstand disintermediation and to create, </p><p>competitive environment conducive to innovation and </p><p>growth. With the lowering of trade barriers and growing </p><p>cross-border flows, markets are becoming global, and </p><p>profitability and productivity have become the corner </p><p>stones. </p><p>After a survey of experiences of financial sector reform in </p><p>nine Asian countries, Tseng and Corker concluded that </p><p>overall financial liberalization and monitory policy reform </p><p>have contributed to more efficient financial systems and </p><p>have enhanced the effectiveness and flexibility of </p><p>monitory policy. </p><p>In India, with a view to gaining the twin goals of </p><p>macroeconomic stabilization and structural adjustments, </p><p>the process of reforms fiscal, financial, monetary and </p><p>industrial was set in motion with great zeal in mid-1991. </p><p>Owing to these reforms the entire competitive structure of </p><p>the economic system has witnessed a major change. </p><p>9. IMPACT OF GLOBALIZATION </p><p> Public-Private partnership Competition in public sector Efficiency Effectiveness Transparency Responsiveness Accountability People participation Business principles Specialization Use of IT Increase in productivity Decrease in number of employees </p><p>10. IMPACT OF LIBERALIZATION Flexibility in policies Increase in production Lessen burden of work on administration Increase in creativity New experiments Loosen the control of administration on economic </p><p>and commercial activities </p><p>11. ADVANTAGES OF GLOBALIZATION </p><p> 1) The growth of international integration of markets </p><p>of goods, services and capital, which is achieved </p><p>due to the unprecedented scope and intensity of </p><p>world trade, global financial flows and the </p><p>production of transnational corporations (Held and </p><p>McGrew, 2000) </p><p>2) The encouragement of a new global division of labour, which is due to a number of manufacturing </p><p>processes to reallocate global scale (Dicken, 1998) </p><p>3) Greater freedom of movement of goods (lowering barriers to international flows of goods and </p><p>services, which resulted in increased interest in </p><p>international specialization and has led to rapid </p><p>expansion of international economic transactions) </p></li><li><p>International Journal of Management and Social Sciences Research (IJMSSR) ISSN: 2319-4421 Volume 4, No. 6, June 2015 </p><p>i-Explore International Research Journal Consortium www.irjcjournals.org </p><p>86 </p><p>4) Strengthening the intensity of international competition, radical reduction of transport and </p><p>communication costs (Strange, 1996) due to </p><p>significant investments in infrastructure (road </p><p>networks, ports and airports, warehouses, modern </p><p>equipment...</p></li></ul>

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