Class 10 Exam  >  Class 10 Notes  >  Social Studies (SST) Class 10  >  Case Based Questions: Globalisation and the Indian Economy

Class 10 Economics Chapter 3 Case Based Questions - Understanding Economic Development

Q1: Read the source below and answer the questions that follow:

Globalisation refers to the integration of economies across the world through foreign trade, investments by multinational corporations (MNCs), and advancements in technology. It has allowed goods, services, and information to move across borders, impacting consumers, businesses, and workers.

i. What is meant by globalisation? (1 mark)
ii. How has technology contributed to globalisation? (1 mark)
iii. Explain one positive and one negative impact of globalisation on Indian businesses. (2 marks)

Ans:
i. Globalisation is the process of increased interconnectedness between countries through trade, investment, and technology.
ii. Technology has contributed by improving transportation, making communication faster, and enabling digital transactions for global trade.
iii. Positive impact: Indian businesses have access to global markets and advanced technology. 
Negative impact: Small businesses face increased competition from MNCs, which may lead to their closure.

Q2: Read the source below and answer the questions that follow:

Multinational Corporations (MNCs) play a major role in globalisation by setting up factories and offices in different countries. They invest in nations where production costs are low, allowing them to maximize profits. MNCs often collaborate with local companies, bringing in new technology and financial investments.

i. What is an MNC? (1 mark)
ii. Why do MNCs invest in other countries rather than producing everything in their home country? (1 mark)
iii. How does the presence of MNCs benefit local industries in a country like India? (2 marks)

Ans:
i. An MNC is a company that owns or controls production in more than one country.
ii. MNCs invest in other countries to reduce production costs, access local markets, and benefit from cheap labor and resources.
iii. Benefits to local industries:

  • Access to modern technology and advanced machinery, which improves productivity and product quality.
  • Increased employment opportunities and financial investments in local businesses, fostering economic growth and development.

Q3: Read the source below and answer the questions that follow:

Foreign trade has been a major channel of globalisation, connecting producers and consumers across different countries. It allows producers to sell goods in multiple markets, while buyers have access to a wider variety of products at competitive prices. However, small businesses often struggle to compete with cheaper imported goods.

i. How does foreign trade lead to market integration? (1 mark)
ii. Give one advantage and one disadvantage of foreign trade for Indian producers. (1 mark)
iii. Explain with an example how foreign trade impacts local industries. (2 marks)

Ans:
i. Foreign trade integrates markets by allowing goods and services to move across borders, leading to competition and price adjustments.
ii. Advantage: Producers can sell their goods in international markets, increasing profits.
Disadvantage: Small businesses may struggle due to competition from cheaper imported goods.
iii. Example: The entry of Chinese toys into Indian markets led to lower prices for consumers due to mass production and economies of scale. However, this negatively impacted local Indian toy manufacturers, as they could not match the low prices of imported toys, resulting in reduced sales and financial losses for domestic businesses.

Q4: Read the source below and answer the questions that follow:

Globalisation has created new employment opportunities, especially in sectors like IT, call centers, and automobile manufacturing. However, many workers in traditional industries have faced job losses due to increased competition and automation. Some jobs have become temporary, reducing job security.

i. How has globalisation impacted employment in India? (1 mark)
ii. Why do some workers face job insecurity due to globalisation? (1 mark)
iii. Suggest two ways the government can help workers affected by globalisation. (2 marks)

Ans:
i. Globalisation has increased employment in service and industrial sectors but has also led to job losses in small-scale industries.
ii. Workers face job insecurity because companies prefer hiring temporary or contract workers to reduce costs.
iii. Two government measures:

  • Providing skill development programs to equip workers with new skills, enabling them to transition to emerging industries.
  • Ensuring fair labor laws and policies to protect workers’ rights, improve job security, and provide social safety nets for those who lose their jobs.

Q5: Read the source below and answer the questions that follow:

The World Trade Organization (WTO) aims to promote free trade by reducing barriers between countries. However, while developing nations like India have reduced trade restrictions, developed countries continue to support their farmers with subsidies, creating an unfair trade environment.

i. What is the role of the WTO? (1 mark)
ii. Why do developing countries argue that global trade is not fair? (1 mark)
iii. Suggest two ways in which WTO can ensure fair trade for all countries. (2 marks)

Ans:
i. The WTO regulates international trade and ensures trade agreements are followed.
ii. Developing countries argue that trade is unfair because developed nations still provide subsidies to their industries, making it hard for developing countries to compete.
iii. Two ways to ensure fair trade:

  • Enforcing equal trade policies for all countries, preventing subsidies for rich nations.
  • Encouraging financial and technical assistance for developing countries to compete in global markets.

Q6: Read the source below and answer the questions that follow:

Liberalisation refers to removing trade restrictions and government control over economic activities. In India, economic reforms in 1991 led to privatisation, reduction of import duties, and greater foreign investment. This helped Indian industries grow but also increased competition, affecting small businesses.

i. What is meant by liberalisation? (1 mark)
ii. How did India’s economic reforms in 1991 impact foreign trade? (1 mark)
iii. Mention one positive and one negative impact of liberalisation on Indian industries. (2 marks)

Ans:
i. Liberalisation means reducing government restrictions on trade and businesses to promote a free-market economy.
ii. India's 1991 reforms opened markets for foreign goods, reduced trade restrictions, and encouraged foreign direct investment (FDI).
iii. Positive impact: Indian companies got access to new technology and global markets.
Negative impact: Small-scale industries faced increased competition from large corporations.

Q7: Read the source below and answer the questions that follow:

Foreign Direct Investment (FDI) refers to investments made by foreign companies in India’s industries, infrastructure, and services. Sectors like automobiles, retail, and telecommunications have attracted large amounts of FDI, leading to economic growth and job creation. However, some fear that foreign companies may dominate Indian markets.

i. What is Foreign Direct Investment (FDI)? (1 mark)
ii. Name two sectors in India that have attracted high FDI. (1 mark)
iii. Explain one advantage and one disadvantage of FDI in India. (2 marks)

Ans:
i. Foreign Direct Investment (FDI) is when foreign companies invest in businesses, factories, or infrastructure in another country.
ii. Two sectors with high FDI in India: Automobiles and Telecommunications.
iii. Advantage: FDI brings advanced technology and increases employment opportunities.
Disadvantage: It may lead to foreign companies dominating local businesses, reducing competition for small firms.

Q8: Read the source below and answer the questions that follow:

Globalisation has benefited consumers by offering a greater variety of goods, better quality products, and competitive prices. Indian consumers now have access to international brands in clothing, electronics, and food. However, small retailers struggle to compete with large multinational corporations.

i. How has globalisation improved choices for Indian consumers? (1 mark)
ii. What impact has globalisation had on the quality and prices of goods? (1 mark)
iii. How has the rise of multinational companies affected small Indian businesses? (2 marks)

Ans:
i. Globalisation has improved choices by bringing international brands to India, offering consumers a wider range of goods.
ii. Globalisation has improved quality due to competition among companies, and prices have become more competitive as more options are available.
iii. The rise of multinational companies has affected small Indian businesses negatively because these companies have larger budgets, advanced technology, better marketing strategies, and economies of scale. This makes it difficult for small retailers to compete, leading to reduced sales, financial strain, and sometimes closure of local businesses.

Q9: Read the source below and answer the questions that follow:

Fair globalisation ensures that all countries benefit equally from international trade. Developing countries, including India, often face challenges like cheap imports harming local industries and farmers not getting fair prices for their products. The government plays a crucial role in ensuring fair trade practices, supporting small businesses, and protecting workers' rights.

i. What is meant by fair globalisation? (1 mark)
ii. How do cheap imports harm local producers in developing countries? (1 mark)
iii. Suggest two ways in which the government can help Indian businesses compete in the global market. (2 marks)

Ans:
i. Fair globalisation means ensuring that all countries and businesses benefit equally from global trade and no one is unfairly disadvantaged.
ii. Cheap imports harm local producers by making their goods less competitive, leading to lower sales and loss of jobs.
iii. Two ways the government can help Indian businesses:

  • Providing subsidies and incentives to small industries, enabling them to compete effectively.
  • Implementing fair trade regulations to prevent the dumping of cheap foreign goods.

Q10: Read the source below and answer the questions that follow:

While globalisation has created new job opportunities, many workers, especially in the unorganised sector, face challenges such as low wages, job insecurity, and lack of benefits. Companies often hire temporary workers to reduce costs, making employment conditions unstable.

i. How has globalisation affected employment in the organised and unorganised sectors? (1 mark)
ii. Why do multinational companies prefer hiring temporary workers? (1 mark)
iii. What can the government do to improve job security for workers in the globalised economy? (2 marks)

Ans:
i. Globalisation has increased employment in the organised sector (IT, telecom) but has made jobs in the unorganised sector (textiles, small factories) more insecure.
ii. MNCs prefer temporary workers because they can be hired and removed easily, reducing company expenses and avoiding long-term commitments.
iii. The government can improve job security by:

  • Implementing labour laws that guarantee fair wages and benefits for all workers.
  • Encouraging skill development programmes to help workers adapt to evolving job markets.

The document Class 10 Economics Chapter 3 Case Based Questions - Understanding Economic Development is a part of the Class 10 Course Social Studies (SST) Class 10.
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FAQs on Class 10 Economics Chapter 3 Case Based Questions - Understanding Economic Development

1. What is globalization and how does it impact the Indian economy?
Ans.Globalization refers to the process of increased interconnectedness and interdependence among countries, primarily through trade, investment, and cultural exchange. In the context of the Indian economy, globalization has led to increased foreign investment, access to international markets, and the proliferation of technology and ideas. This has resulted in economic growth, job creation, and improved living standards for many. However, it has also posed challenges such as income inequality and the risk of cultural homogenization.
2. What are the advantages of globalization for India?
Ans.The advantages of globalization for India include enhanced economic growth, increased foreign direct investment (FDI), access to advanced technologies, and improved export opportunities. It has facilitated the integration of Indian markets with the global economy, leading to greater competitiveness. Additionally, globalization has encouraged the growth of various sectors, including information technology, pharmaceuticals, and manufacturing, boosting employment and innovation.
3. What are the disadvantages of globalization for the Indian economy?
Ans.The disadvantages of globalization for the Indian economy include potential job losses in certain sectors due to increased competition from foreign companies, widening income inequality, and the threat to local industries. Moreover, globalization can lead to cultural erosion as global brands and lifestyles take precedence over traditional practices. Environmental concerns also arise, as the rush for economic growth may lead to unsustainable practices.
4. How has globalization affected Indian agriculture?
Ans.Globalization has significantly impacted Indian agriculture by opening up new markets for agricultural products and encouraging modernization through access to technology. However, it has also exposed farmers to global price fluctuations, which can adversely affect their income. While some farmers have benefited from increased exports, others, particularly small farmers, may struggle to compete against larger agribusinesses, leading to challenges in livelihoods and sustainability.
5. What role does the government play in managing globalization in India?
Ans.The government plays a crucial role in managing globalization in India through the formulation of policies that promote fair trade, protect local industries, and ensure sustainable development. It implements regulations to safeguard consumer rights, labor standards, and environmental protection. Additionally, the government works to attract foreign investment while also supporting domestic businesses to compete on a global scale, thus balancing the benefits and challenges of globalization.
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