Q. 1 . The world economy is globalizing at an accelerating pace. Discuss this statement and list the benefits of globalization.Ans: The world economy is globalising at an accelerating pace as countries previously closed to foreign companies have opened up their markets. Geographic distance is shrinking because of the Internet, as the ambitious companies aim for global leadership. All this is possible because of booming international business.

International business is mainly concerned with the issues that are related to international companies and governments cross border transactions. International business involves multiple countries to satisfy the objectives of every individual as well as the organisations. International business management is a process of achieving the global objectives of a firm by effectively managing the human, financial, intellectual and physical resources. In a rapidly changing global economic scenario under World Trade Organization, starting an international business is considered to be more complex than starting a domestic business. There are two specific reasons for it. Firstly, the numbers of parties involved in international trade are more than domestic business. Such parties may include customs officials, Director General of Foreign Trade, Reserve Bank of India, excise officials and duty drawback officials, insurance companies, shipping companies, freight forwarders, and banks except exporter and importer himself. All of them help in administering, regulating, facilitating and financing the export import business. The diagram given below illustrates the agencies involved in entire international trade process. Globalisation is a process where businesses are dealt in markets around the world, apart from the local and national markets. According to business terminologies, globalisation is defined as the worldwide trend of businesses expanding beyond their domestic boundaries. It is advantageous for the economy of countries because it promotes prosperity in the countries that embrace globalisation. In this section, we will understand globalisation, its benefits and challenges.Benefits of globalisation

The merits and demerits of globalisation are highly debatable. While globalisation creates employment opportunities in the host countries, it also exploits labour at a very low cost compared to the home country. Let us consider the benefits and ill-effects of globalisation. Some of the benefits of globalisation are as follows:

Promotes foreign trade and liberalisation of economies.

Increases the living standards of people in several developing countries through capital investments in developing countries by developed countries.

Benefits customers as companies outsource to low wage countries. Outsourcing helps the companies to be competitive by keeping the cost low, with increased productivity.

Promotes better education and jobs.

Leads to free flow of information and wide acceptance of foreign products, ideas, ethics, best practices, and culture.

Provides better quality of products, customer services, and standardised delivery models across countries.

Gives better access to finance for corporate and sovereign borrowers.

Increases business travel, which in turn leads to a flourishing travel and hospitality industry across the world.

Increases sales as the availability of cutting edge technologies and production techniques decrease the cost of production. Provides several platforms for international dispute resolutions in business, which facilitates international trade.