India's Globalization: Evaluating the Economic Consequences

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India's Globalization: Evaluating the Economic Consequences By Sri Baldev Raj Nayar Vistaar Publications, New Delhi, 2007, Pages: 99; Price: Rs. 225 ISBN: 978-81-7829-758-3

The author presents a practical insight into the concept of globalization and its impact on Indian economy. It dispels the myths of globalization and presents a logical case on the positive impact on Indian economy in a lucid and easy-to-understand style. The literature review is current and up-to-date and the author has used empirical data to substantiate his case.

The book runs as a long discourse with strong linkages among the issues identified in the process of assessing the impact of globalization on Indian economy. However, for our analysis, the contents of the book can be organized into four major topics of discussion: Introduction, India's Reintegration with the World Economy, Assessing the Consequences of Globalization, and Conclusion.

The book starts with a brief introduction on economic globalization, the review of literature on economic globalization, hypotheses tested in this study, methodology adopted, the complexity in assessing the impact of globalization. The style of presentation is unique, holds the attention of the reader and offers a lot of intellectual discussion. "The supporters of globalization regard it as a wholly benign process heralding the long awaited deliverance of humanity from economic backwardness, underdevelopment and misery. For them, allowing market forces to work largely unhindered by the state and its politics will make possible higher economic growth and therefore human welfare. There are critics who view globalization as a source of economic stagnation, deindustrialization, economic destabilization, impoverishment and growing inequality".

Against a backdrop of review of literature, the author casts his hypothesis for the study: "Increased integration of the national economy into the world economy under globalization will have significant negative outcomes for the former, such as the five broad elements, namely: (a) economic stagnation; (b) industrialization with the closure of domestic firms in the face of unhindered imports; (c) denationalization, with the takeover of domestic firms by foreign multinationals; (d) economic destabilization, marked by a higher frequency of economic crises arising from the greater exposure of the nation to external shocks; and (e) increased impoverishment".

The Case Study approach has been chosen for analyzing India's experience with globalization and the selected process of economic liberalization. "India constitutes one fifth of the population of the developing world, containing more people than all of Africa or the Western hemisphere. India has been unique in terms of democratic framework for more than half-century. It is unrivalled in the developing world for its ethnic and linguistic diversity; the presence of large number of states within its ethnic federation - many of which themselves surpass the population of most developing countries".

The study first examines the nature and extent of the reintegration of India's economy with the world economy and then assesses the economic consequences of such reintegration for the economy in terms of hypothesis. In assessing the consequences of globalization for India's economy, the study compares the experience of the period under globalization - with its different phases delineated with that under non-globalization, a step that is absolutely essential. The experience of India has not furnished the critics of globalization with much basis for argument.

The nature and extent of India's integration into the world economy has been discussed along three dimensionsflow of goods and services, capital flows and migration of people. "While India has made substantial strides, it still represents a case of limited integration compared to dynamic economies such as China, Korea, and Mexico. However, even this limited integration has had enormous consequences for India". …