Introduction
 Advent of ICT
 Increased integration of market
 Mobility of people for job and vacation
 Reach of satellite channels
 Internet
 Global Village
Globalization
 Most complex term
 Misused and misunderstood, misinterpreted
 Globalization is used to refer to increasing influence
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extended by economic, political, socio-cultural and
financial processes across the globe.
Numerous challenges and opportunities
India and China were the world’s most dominant economic
till the early nineteen century where as US, UK and Japan
emerged as strong economies lately
Import restriction after world war
Import substitution strategies
Multinational organizations set up after world war II
Globalization of Business
 In the beginning of Christian era, India was the most
populated country with 75 million people constituting
32.5 percent of world population (230 million), China
25.8 percent
 India was the world’s largest economy with 32.9
percent share of the world’s GDP, China 26.1 percent
 India and China continued to remain the two most
dominant economies till the early nineteenth century.
 India was a highly developed manufacturing country
and exported her manufactured products to Europe
and other nations.
 The banking system in India was efficient and well
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organized – hundies
Ship building industry in India
Big market for Indian products in Europe
Industrialization in Britain and new class of capitalist
Monopoly of East India Company to export Indian
products to Britain
World War I period witnessed the growth of globalization,
mainly led by technological forces in the field of
transportation and communication
The pace of globalization decreased between first and
second world war because of trade barriers
Most developing countries that gained independence from
the colonial rule in the immediate post World War II
followed import substitution policy to promote local
industries
 Establishment of multilateral organization like World
Bank, IMF and GATT in the post war era
 Setting up to WTO in 1995
 Enormous impact of information and communication
technology on integration, efficiency and industrial
organization in recent period
Concept of Globalization
 Free cross border movement of goods, services, capital,
information and people
 Role of technological development
 www era
 Globalization tend to erode national boundaries and
integrate national economies, cultures, technological
interaction that leads to the establishment of
transnational structure and integration of economic,
political and social processes on a global scale
Globalization
 Economic Globalization
 Financial Globalization
 Cultural Globalization
 Political Globalization
Dimension of Economic Globalization
 Globalization of production
 Globalization of markets
 Globalization of competition
 Globalization of technology
 Globalization of corporations and industry
Factors Influencing Globalization
 Economic liberalization
 Technological breakthroughs (a) Manufacturing (b)
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Transportation (c) Information and communication
Multilateral Institutions
International economic integrations
Rising research and development costs
Global expansion of business operations
Advent of logistics management
Emergence of global customer segment
 Regulatory controls
 Emerging trade barriers
 Cultural factors
 Nationalism
 Was and civil disturbances
 Management myopia
Concept of International Business
 Conducting business activities beyond national
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boundaries
International trade
International marketing
International investments
International management
Global business
Reasons for International Business
Expansion
 Market seeking motive : (a) marketing
opportunities due to life cycle
(b)uniqueness of product or service
 Economic motives: (a) profitability (b)
achieving economies of scale (c) spreading
R&D costs
 Strategic Motive: (a)Growth (b) Risk spread
Domestic v/s International
Business
 Economic environment
 Socio-cultural environment
 Legal environment
 Political environment
 Competition
 Infrastructure
 Technology