Previous Year Questions: Globalisation & the Indian Economy - Social Studies (SST) Class 10

Very Short Answer Type Questions

Q1: State any one example of 'Trade Barrier'.    [AI 2019]
Ans: Tax on imports is an example of a trade barrier.

Q2: Why do MNCs set up their offices and factories in those regions where they get cheap labour and other resources?    [AI2016]
Ans: Multinational companies usually set up their offices and factories in regions (countries) where they get land, labour and raw materials at a cheaper rate. This makes them more competitive in the world market and can lead to greater profitability.

Q3: Differentiate between investment and foreign investment.    [AI 2016]
Ans: Investment by any person or entity is the money spent for buying building, land or other assets with a motive to earn a profit in future by selling it or in any other fashion. Foreign investment is any investment made by a foreign business entity such as a MNC, or an individual or a foreign government in India for buying assets with the motive to earn a profit from it.

Q4: Due to which reason the latest models of different items are available within our reach?  [Foreign 2016]
Ans: Due to globalization, the latest models of different items are available within our reach.

Short Answer Type Questions

Q1: How is information technology connected with globalization?    [2023]
Ans: Information technology has played a crucial role in accelerating the pace of globalization. It has transformed the way people interact and communicate across the globe. With the development of information technology, individuals can now connect with anyone, anywhere in the world, instantly. While physical movement of products may still take time, all other transactions can be conducted through the internet. Information technology has enabled the rapid dissemination of information, facilitating faster decision-making and integration among countries.

Q2: Examine the steps taken by the Central and State governments to attract foreign companies to invest in India.     [Term-II, 2021-22[
Ans: The Central and State governments have taken several measures to attract foreign companies to invest in India. Some of these steps include:

• Simplification of rules and regulations: The government has simplified the procedures and regulations related to foreign direct investment (FDI) in order to create a more business-friendly environment. This includes streamlining the approval process and reducing bureaucratic red tape.
• Incentives and benefits: The government offers various incentives and benefits to foreign companies, such as tax exemptions, subsidies, and financial assistance. These incentives are aimed at attracting investment and promoting economic growth.
• Infrastructure development: The government has focused on developing world-class infrastructure, including transportation, communication, and industrial facilities. This infrastructure development provides a conducive environment for foreign companies to set up their operations.
• Skill development and training: The government has prioritized skill development and training programs to enhance the employability of the workforce. This ensures that foreign companies have access to a skilled and qualified pool of talent.
• Sector-specific policies: The government has formulated sector-specific policies to attract foreign investment in key industries such as manufacturing, services, and technology. These policies provide clarity and guidance to foreign companies interested in investing in these sectors.

Overall, the Central and State governments have been proactive in creating a favorable investment climate to attract foreign companies to invest in India.

Q3: Examine the debate that took place in the World Trade Organisation for the developing countries.   [Term-II, 2021-22]
Ans: All WTO agreements contain special provisions for developing countries, including longer periods to implement agreements and commitments, measures to increase their trading opportunities, and support to help them build the infrastructure for WTO work, handle technical barriers, and implement technical standards. 

Q4: Read the source given below and answer the questions that follow:  [2021 C] 
We have seen that the liberalization of foreign trade and investment in India was supported by some very powerful international organizations. These organizations say that all barriers to foreign trade and investment are harmful. There should be no barriers. Trade between countries should be ‘free’. All countries in the world should liberalize their policies. World Trade Organization (WTO) is one such organization whose aim is to liberalize international trade. Started at the initiative of the developed countries, WTO establishes rules regarding international trade and sees that these rules are obeyed. 149 countries of the world are currently members of the WTO (2006). Though WTO is supposed to allow free trade for all, in practice, it is seen that the developed countries have unfairly retained trade barriers. On the other hand, WTO rules have forced developing countries to remove trade barriers. An example of this is the current debate on trade in agricultural products.

(i) Which among the following organizations establishes the rules regarding international trade?
(a) WHO 
(b) WTO 
(c) UPU 
(d) IMF
Ans: (b)

(ii) Which of the following is the aim of World Trade Organization?
(a) To liberalise international trade 
(b) To provide loans to the developing countries 
(c) To help countries economically 
(d) To resolve the political disputes between countries
Ans: (a)

(iii) Which one of the following options defines Liberalization?
(a) Impose the tax on economic activities
(b) To set barriers by the government in the economic field 
(c) To remove barriers set by the government 
(d) Self-control on all economic activities
Ans: (c)

(iv) Who among the following had initiated to start the World Trade Organization (WTO)?
(a) European Union 
(b) Non-Aligned countries 
(c) Developing countries 
(d) Developed countries
Ans: (d)

Q5: "Tertiary sector activities help in the development of primary and secondary sectors." Evaluate the statement. [CBSE 2020]
Ans: The statement "tertiary sector activities help in the development of primary and secondary sectors" is true. Here are some points to support this statement:

• Linkages: The tertiary sector provides crucial linkages between the primary and secondary sectors. For example, the transportation and storage services provided by the tertiary sector help the primary and secondary sectors to move goods and products from one place to another.
• Demand: The tertiary sector creates a demand for goods and services produced by the primary and secondary sectors. For instance, the demand for construction services in the tertiary sector creates a demand for cement and other building materials from the secondary sector.
• Employment: The growth of the tertiary sector creates new job opportunities, leading to increased demand for goods and services from the primary and secondary sectors. As people's incomes increase due to the growth of the tertiary sector, they tend to consume more goods and services, further boosting the primary and secondary sectors.

In conclusion, the development of the tertiary sector plays a vital role in the growth of the primary and secondary sectors, and hence, the economy as a whole.

Q6: How has globalisation affected the life of Indians? Explain with examples. [CBSE 2019]
Ans: Globalization has had a significant impact on the life of Indians, especially in terms of the country's economic growth and cultural exchange.
Economically, globalization has led to the growth of India's IT and service sectors, which has resulted in job creation and increased foreign investment. For instance, many multinational companies have set up their offices in India, which has created a significant number of employment opportunities for Indians.
Culturally, globalization has led to the exchange of ideas, values, and practices between India and other countries. This has led to the popularity of Indian art, music, and cuisine in other parts of the world. For example, Indian movies and music have gained immense popularity worldwide, which has helped promote Indian culture and values globally.
However, globalization has also had some negative effects, such as the displacement of traditional industries and the exploitation of workers. For instance, many small-scale industries have shut down due to the competition for cheaper imported goods, leading to unemployment and loss of livelihood for many Indians.
Overall, globalization has had both positive and negative impacts on the lives of Indians, and it is crucial to ensure that the benefits of globalization are distributed equitably among all sections of society.

Q7: The impact of globalisation has not been uniform.” Discuss with the help of examples.
Or
Discuss the impact of globalisation on India.   [CBSE 2018]
Ans: (a) Positive impact: 
(i) It has resulted in more choices for consumers to get various products of better quality and at lower prices.
(ii) It has improved the standard of living.
(iii) With the investments by the MNCs new jobs have been created in the developing countries.
(iv) New technology has been introduced.
(v) Large companies have become multi-national companies such as Infosys.
(b) Negative impact: 
(i) Creation of special economic zones has disrupted the lives of the people who have been displaced.
(ii) Flexibility in labour laws has worsened the condition of workers who may be appointed temporarily.
(iii) Small producers are unable to compete with MNCs. Thus, several units have been shut down rendering many workers jobless.

Q8: “Foreign trade integrates the markets in different countries.” Support the statement with arguments. [CBSE 2018]
Ans: (i) It creates an opportunity for producers to reach beyond the domestic market, i.e., markets of their own countries.
(ii) Producers can sell their products in the markets of their own country as well as in Gather countries all over the world.
(iii) The producers can compete in the markets of other countries.
(iv) The buyers too have a choice between the goods produced in different parts of the world. It enables the consumer to buy according to his requirement.
(v) The competition among the producers brings them closer to each other.
(vi) Sometimes the producers of other countries set up joint ventures as AIG has set up a joint venture in the insurance sector and is selling their products in India.
(vii) Producers in two countries closely compete against each other even though they are separated by thousands of miles. Thus, foreign trade results in connecting the markets or integration of markets in different countries.

Q9: How have our markets been transformed in recent years? Explain with examples. 
Or
What changes have taken place in the markets during the last twenty years or so?    [CBSE Sample Paper 2018, CBSE 2016-17]
Ans: (i) We have a wider choice of goods and services.
(ii) The latest models of digital cameras, mobile phones, and cars by the leading manufacturers of the world are available.
(iii) An explosion of brands can be seen for almost every good i.e., from shirts to televisions.

Q10: Barriers on foreign trade and investment were removed to a large extent in India since 1991.” Justify the statement.    [CBSE 2016]
Or
Why had the Indian government put barriers to foreign trade and foreign investments after independence?    [CBSE 2016]
Ans: (A) (i) The government had put restrictions on the import of goods to protect domestic producers from foreign competition.
(ii) The government allowed imports of only essential items such as machinery, fertilisers and petroleum. These restrictions helped to attain technological capability within the country.
(B) (i) Starting around 1991, the government wished to remove the barriers because India had attained technological capability.
(ii) The government decided that the time had come for Indian producers to compete with producers around the globe.
(iii) It felt that competition would improve the performance of producers within the country.
(iv) There would be an unrestricted exchange of capital, technology and experience between India and other countries of the world.

Q11: How are MNCs controlling and spreading their productions across the world? Explain. [CBSE 2015]
Ans: (i) MNCs set up production jointly with local companies.
(ii) MNCs buy up local companies to expand production.
(iii) MNCs in developed countries place orders for production with small producers of developing countries for various products such as garments, footwear etc. The MNCs sell these products under their brand name. MNCs determine price, quality, delivery and other conditions for these producers.

Q12: How are MNCs spreading their production across countries? Explain with an example.

Multinational Corporations (MNCs) are spreading their production in different ways. Some of them are:  [CBSE 2012]

• By buying local companies and, then expanding production. For example, Cargill Foods, a very large American MNC, purchased small Indian company, Parakh foods. Cargill Foods is, now, the largest producer of edible oil in India with a capacity making 5 million pouches daily.
•  By placing orders for production with small producers. Garments, footwears, sports items are examples where production is carried out by small producers for large MNCs around the world.
•  By producing jointly with some of the local companies. It benefits the local company in two ways.

1. A MNC can provide money for additional investments.
2. A MNC can bring latest technology for production.

For example, Ford Motors set up a large plant near Chennai, in collaboration with Mahindra and Mahindra, a major Indian manufacturer of jeeps and trucks.

Long Answer Type Questions

Q1: Explain any five steps taken by the developing countries to attract Foreign investment.    [2023]
Ans:

• Some governments have set up Special Economic Zones with best facilities of electricity, water, etc.
• Companies who set up their units in SEZs don't need to pay taxes for the first five years.
• The government has allowed flexibility in labor laws so that the companies find it profitable.
• Companies can hire workers without the security of jobs, especially during periods of intense work pressure.
• The government provides various legal concessions to attract companies to invest in India.

Q2: 'Liberalization of foreign trade involves policy framework at National and International level’. Explain the statement.    [2023]
Ans: Liberalization involves removing barriers or restrictions set by the government. Liberalization of foreign trade involves policy framework at the national and international level. This means that goods can be imported and exported easily, and foreign companies can set up factories and offices in a particular country. The government imposes fewer restrictions than before and is therefore said to be more liberal.

Q3: Explain the rapid transformation in the communication sector in modern times.    [2023]
Ans: In recent times, technology in the telecommunications, computer, and internet fields has been changing rapidly. Telecommunication facilities such as telegraph, telephone (including mobile phones), etc., are used to contact one another around the world, access information instantly, and communicate from remote areas. Information and communication technology has played a major role in spreading out the production of services across countries. For example, a news magazine published for London readers can be designed and printed in Delhi, with the text of the magazine sent through the internet to the Delhi office.

Q4: Explain the characteristics of International trade of India.    [2023]
Ans:

• Gross National Product (GNP) of India represents the total value of finished domestic goods and services owned by the country's residents.
• India's share in world trade, both import and export, is slowly decreasing each year.
• There has been a change in the composition of imports and exports, with imports increasing and exports reducing in India.
• Limited number of ports in the country make them overcrowded, making trading difficult.
• India's foreign trade is highly dependent on foreign shipping companies and banks, which need to be effectively managed and regulated.

Q5: Examine the factors which facilitate globalization in India.   [CBSE 2022]
Ans: Globalization refers to the process of integration of economies, cultures, and societies across the world. In India, globalization has been facilitated by various factors.
One of the key factors is the liberalization of the Indian economy in 1991. Before this, the Indian economy was largely closed to foreign trade and investment. However, the government introduced a series of economic reforms that opened up the economy to foreign competition and investment. This helped to attract foreign companies to invest in India and trade with Indian companies, thereby increasing the integration of the Indian economy with the rest of the world.
Another important factor is the development of information technology (IT) and communication technology (ICT) in India. The growth of the IT and ICT sectors has enabled India to become a hub for outsourcing and offshoring services such as software development, call centre operations, and back-office support. This has further facilitated the integration of the Indian economy with the global economy.
The expansion of transportation and logistics infrastructure, including the development of ports, airports, and highways, has also facilitated globalization in India. Improved transportation infrastructure has made it easier and cheaper for companies to transport goods and services across the country and borders, thereby facilitating international trade and investment.
Finally, the growing middle class in India has also contributed to globalization. With a rising standard of living, the middle class has become increasingly interested in global products and services, leading to greater integration of Indian markets with global markets.
In conclusion, the liberalization of the Indian economy, the development of IT and ICT, improved transportation and logistics infrastructure, and the growing middle class have all facilitated globalization in India. These factors have helped to make India a more integrated player in the global economy.

Q6: Compare the economic activities of the private sector with that of the public sector. [ CBSE 2019]
Ans: Here are some points that compare the economic activities of these two sectors:

• Ownership: Private sector is owned by individuals or companies, while public sector is owned by the government.
• Profit Motive: Private sector operates with the objective of making profits, while public sector aims to provide goods and services to the public at affordable prices.
• Investment: Private sector invests its own capital in business activities, while public sector relies on government funding for its investments.
• Efficiency: Private sector is generally considered more efficient than the public sector, as it operates with the aim of maximizing profits and minimizing costs. On the other hand, the public sector often faces bureaucratic hurdles and inefficiencies.
• Employment: Both sectors provide employment opportunities, but the private sector is generally more flexible and dynamic in its hiring practices.

Overall, while both private and public sectors play important roles in the Indian economy, their economic activities are characterized by different ownership structures, objectives, investment patterns, efficiency levels, and employment practices.

Q7: “Information and communication technology has played a major role in spreading out production of services across countries.” Justify the statement with examples.    [CBSE 2016]
Ans: (i) Telecommunication facilities - telegraph, mobile phones, fax - are used to contact one another around the world and to communicate from remote areas.
(ii) This has been facilitated by satellite communication devices.
(iii) Computers have now entered almost every field of activity.
(iv) Internet allows us to send instant electronic mail (e-mail) and talk (voice mail) across the world at negligible costs.
(v) IT has played a major role in spreading out the production of services across countries. For example, for a magazine published for London readers different work is done as follows:
(a) Designing in Delhi.
(b) Orders how to design from London.
(c) Designing done on the computer.
(d) After printing sent to London by air.
(e) Payment through e-banking.

Q8: Explain the role of technology in stimulating globalisation process. [CBSE 2015]

Answer: The improvement in technology has stimulated the globalisation process as:

There has been many improvements in transport technology in the recent years that have enabled faster delivery of goods across the world.

• Development of information technology in the areas of telecommunication like internet has revolutionised the world.
• Use of telegraph, mobiles, fax have enabled faster and easier access to information anywhere at any point of time.
• All these developments have further decreased the cost of their operations favouring the consumers around the world.
• It has opened up horizons for further advancement, research and development of existing means.

Q9: Explain any four ways by which MNCs exercise control on production. [CBSE 2014]

Multinational Corporations (MNCs) exercise control on production in the following ways:

• By setting up their factories or production units close to markets where they can get desired type of skilled or unskilled labour at low cost along with other factors of production.
•  By collaborating with existing local companies of a country.
• By buying the local companies and then expand or control its production with the help of modern technology and capital.
•  By placing orders to small producers and selling these products under their own brand name to the customers worldwide.