A short prelude to globalization
The concept of globalization should not be new to you. Globalization substantially means advancement in the integration and exchange of resources. Now, when there is globalization, there is industrialisation. Unprecedented increase in industrialisation has conventionally led to urbanisation. And don't you think that a rapid increase in urbanisation is largely affecting the primary sector, which is highly exploitative? Primary sector- This sector of economy includes use of natural resources such as agriculture, fishing, mining etc. Now to answer the former question, we need an example. There is a farmer who maintains his livelihood by selling vegetables and by producing grains. Grains such as wheat, rice, paddy and maize. Everything is flowing smoothly. On a sunny day wishing for rain, he gets a very strong feeling that things are going to be devastating. His production fails. All of his money that he had spent on irrigation and buying goods like crops and urea, lost. This was the second year, and his production failed, yet again. Without any further risking, he moves into a city. He searches for a few jobs, and fortunately he gets a new job in tertiary sectory which pays him good enough to maintain his life and livelihood. He starts saving for his children's education. He starts picturing a secure future. There are a few points he notices in both fields when he deeply looks at the status quos. a.) There were no savings when he was into farming, and he dissects the low rate of economic growth. b.) He couldn't see a secure future. c.) Even if this new job doesn't promise him a secure future, he has ideas. He has resources. He has his own savings. He is open to quit this job, and this experience level will help him find a new and a better job than the previous one. d.) Tertiary sector is full of jobs, and not parochial like primary sector. e.) Instability of output of agriculture sector. So, what do we conclude? We conclude that the soared increase in industrialisation, and hence resulting into urbanisation largely affects the primary sector which is very important for less developed countries. Okay, a quick question at the end of this short knowledge segment (brought to you by viden.io). Don't you think the day is not so far when secondary and tertiary sector will superpose the outweigh of primary sector? And oh, the farmer is thinking to relocate his family members to the new city.
Has the WORLD really accepted Globalization??
Has the world actually accepted globalization? By Ravindra Rao From nomads to urban warriors, human kind has seen a drastic and technical transition over centuries, since its inception. We are 'social animal' and have always thrived to mingle and jingle with the society. Integrating ourselves; our emotions, our feelings, our work and what not with people. There was always a sole principle in the back of our mind that distance doesn't matter but the forces does to bind us with the people. All of these sayings can be compressed into a word, i.e. globalization. Globalization has sprouted its way back to many thousands of years. People have been buying from and selling to each other in lands at great distances. Technically, globalization is a process of expansion, integration, interaction and anchoring among entities of different nations driven by international trade and aided by information technology. Well, that was definitely a jargon and to summarize it in a crisp manner globalization is the process by which anyone (individual, business or any organization) can work and operate on an international scale. Since 1950, for example, the volume of world trade has increased by 20 times and it keeps on increasing to 'n' times by every single passing day. During the middle-ages, traces of globalization are found like the famed silk route across central Asia that connected China and Europe. Portuguese and the East India company had deliberately traded with India during 18th, 19th and 20th century. This shows how the world has adopted globalization and is harnessing it. But everyone doesn't have the same perspective to it. Globalization is deeply controversial. However, proponents of globalization argue that it allows poor countries and its citizens to develop economically and raise their standard of living through the free flow of FDI, while opponents of globalization claims that it is the process through which rich and powerful people expand their means to utilize (whether efficiently or not) at the cost of poorer and weaker. All these things whether true or not have certainly undermined the scope of globalization. Certainly, globalization is a platform through which domestic traders and entrepreneurs can compete with international organization and prove their mettle. Had it not been globalization, India which was at the brink of having debt trap in 1990-91 certainly would not be able to develop her economy and to become a nation having fastest developing economy rate in the world. Globalization is the medium through which our culture, our teachings, our skills, our proficient products can be integrated to the global market and provide everyone with the heritage we have. In a rapidly changing world, where every hour, every minute and every single second, we are leaping toward a more scientifically advanced technology, globalization is the key feature through which everyone can get the benefit of it. Many says, it is a harm to our culture, our tradition and it might be true in certain conditions when people starts believing that everything western is superior and start neglecting their own customs. Well, culture and traditions are certainly not penal to abide by but mixing it with western, dissolves the teachings of our ancestors which might hurt cultural sentiments. Gandhi Ji said, "I do not want my house to be walled in on all sides and my windows to be stuffed. I want the culture of all lands to be blown about my house as freely as possible. But I refuse to be blown off my feet by any." This surely explains that he did understand the pros and cons of globalization. With all the hustle and bustle pushing and pulling the flow of international trade, globalization has helped to reach out to thousands and millions of people living in far, distant and remote areas. Globalization is surely integrating domestic market to international market but only this does not reflect the actual scope of globalization. It is the transfer of ideas, sentiments and much more. It is the mean through which savings (money, resources, culture or anything) can mobilized and channelized into a productive use. In the light of realities, the present situation is that rich and big industrialists run few errands to lure and coax poor labourforce of under-developed and developing countries. And the poor people in search of better life prospects and opportunities confirm their candidature. Globalization is about providing equal opportunity to all with free and fair competition and promotes equity. Today, we are living in a dynamic society where every second is passing by with new advancement in technology and developing various innovative courses of action to accomplish and certify a given task. Globalization has paved ways and opened many doors of opportunity for tech-know-how and fresh grads. Many nations have actually suffered a lot for not accepting globalization and sometimes, accepting it becomes a necessity rather than choice. Today, world has become a global village because of globalization. Everything we did earlier can be done now within seconds. Foreign direct investment (FDI), availability of alternatives, discovery of new technology is possible because of globalization. If the world had not accepted globalization, then today the situation must have been strange. So, all thanks to globalization due to which we all are able to interact and integrate ourselves. Internet, a.k.a the world wide web is a catalyst and a component of globalization. It is now very hard to imagine a nation where the economy has not actually not accepted globalization. An isolated nation may not be able to procure and produce resources to fulfill its citizen's needs and demands. The present scenario is that the world has partially accepted globalization in terms of trading purposes and continue to hinder the social and culture elements of globalization. So, this is the high-time when people have to realize the potential of globalization and take it as a nurturing tool. The world consists of individual and is indifferent to everyone. Globalization should positively affect the lives of all people and then it will be sure that the world has actually accepted globalization but till then it is just accepted by riches who bait others and the victim are eventually the poor people. It is sure that "a day" will come when globalization will help everyone to get their 'ambition-work' and executed properly. Platforms like Viden.io are proving to be boon for the students as well as professionals to get their skills amalgamated with proper and executory knowledge. So peeps get your skills harnessed. :)
India's External Sector
India’s external sector remained resilient in 2016-17 amidst considerable fl ux in the international environment; the Box in sub-section 6 on the external vulnerability watch argues the case analytically. Shrugging off a two-year contraction, merchandise exports turned around in the face of muted global demand. Drivers of this rebound are profi led in the immediately following sub-section. This development also assumes signifi cance in view of the decline in net invisible receipts addressed in sub-section 3. Merchandise imports remained sluggish, although a signifi cant pick-up occurred in H2. Consequently, rising international commodity prices and the erosion in terms of trade gains notwithstanding, India’s merchandise trade defi cit narrowed further in 2016-17 and helped compress the current account defi cit (CAD)
Grameen Bank believes that lack of access to credit is the biggest constraint for the rural poor. If the poor are provided credit on reasonable terms, they themselves best know how to increase their incomes. Grameen Bank targets and mobilizes the poor and creates social and financial conditions so that they receive credit by identifying a source of self-employment in familiar rural non-farm activities. The Bank's method of targeting the poor is effective as it mobilizes only those who are willing to bear the costs of group formation, training, and monitoring each other's activities, and those who are satisfied with the relatively small sums they can borrow and repay. To better meet its ultimate goal of social and economic development, Grameen Bank targets women more than men. By doing so, it directly channels credit to the poorest and the least empowered and helps improve the living standards of their families. Along with providing credit, Grameen Bank offers guidelines to members for codes of conduct and activities aimed at improving their social and financial conditions. It also provides training to women in maternal health, nutrition, and childcare to generate greater demand for basic health care services. Lending entails high risk of loan default due to adverse selection of borrowers and disability of lenders to enforce the loan contracts. Contrary to the practice of formal finance, Grameen Bank lends (in small amounts) to the poor based on group responsibility where individual access to credit depends on group from bad ones. Unlike other development banks, Grameen Bank mobilizes savings as an integral part of lending. Each member is required to save Taka 1 each week and buy a Grameen Bank share worth Taka 100. In addition, each borrower contributes 5 percent of the loan amount to a group fund and Taka 5 for every 1,000 Takas above loan size greater than Taka 1,000 to an emergency fund. These savings mobilization schemes provide protection of loans against default, an internal source of finance, and a stake for the members in Bank operations. In 1993, with 1,039 branches covering almost half of Bangladesh's villages, the Bank served more than 1.8 million borrowers and disbursed $169 million. By 1993, cumulative member savings totaled over $218 million. Almost 94 percent of the Bank's members are poor women, accounting for nearly 70 percent of savings mobilized, and receiving over 80 percent of the total loans disbursed. Its loan recovery rate has been consistently over 90 percent compared with rates from 25 to 50 percent for other financial institutions in Bangladesh. Contrary to common belief, Grameen's experience is that women are better credit risks with higher loan recovery rates than men (97 percent compared to 89 percent in 1992), and that the dropout rate is lower for women (15 percent) than for men (25 percent). The Grameen model is being replicated in more than 30 countries and the World Bank has provided a grant of $2 million for its replication in low-income countries. While sophisticated econometric analysis is underway, preliminary analysis suggests that Grameen Bank has generated a number of benefits both at the household and village level. At the household level, the benefits from program participation include changes in income, employment, assets accumulation, networth, and other household welfare indicators (such as contraceptive use, school enrollment of children, etc.). Program participation has enabled members to enhance their assets and networth. For example, a program participating household owns 56 percent more resources and 51 percent more networth than a nonparticipating household. Program participation has also increased calorie intake, especially among female household members. The incidence of poverty is substantially reduced among program participants. Labor force participation, especially among women, is higher among participants than nonparticipants; women's labor force participation is 66 percent among program participants compared to 52 percent for non participants. The school participation rate of girls is also higher for participants (57 percent) than for nonparticipants (36 percent). Program participation also increases the use of contraceptives, better toilet facilities, and better drinking water. In addition, program placement generates income gains for the poor as a whole through its impacts on the local resource allocation. For example, the daily male wage is 23 percent higher in program villages compared with nonprogram villages. Even after controlling for village characteristics, the study finds that up to 11 percent of the 23 percent wage increase is due to Grameen Bank program placement.