Which of the following is an impact of globalisation on India's trade?
Show answer & explanation
Correct answer: B
Explanation
The Correct answer is option 2 i.e. It has increased the volume and diversity of trade.
Globalisation has significantly impacted India’s trade by increasing both the volume and diversity of goods and services exchanged across borders. With liberalization policies since the 1990s, India opened its markets to global competition and investment, leading to a surge in exports and imports. Indian businesses gained access to a wider range of global products, technologies, and markets. Simultaneously, Indian goods, especially in sectors like IT, textiles, pharmaceuticals, and automobiles, found new international markets. This integration into the global economy enhanced trade diversity and helped India become a more active participant in the world economy.
Other Options:
It has increased the self-reliance and autonomy of trade
Incorrect – Globalisation has actually made India more interconnected and interdependent with other economies, reducing complete self-reliance.
It has reduced the competition and challenges of trade
Incorrect – On the contrary, globalisation has increased competition, exposing Indian businesses to global players and market dynamics.
It has reduced the dependency on foreign markets
Incorrect – Globalisation has increased dependency on foreign markets for both imports (like crude oil, electronics) and exports (like IT services, textiles).