Globalisation continues to evolve, demonstrating remarkable resilience through financial crises, pandemics, and geopolitical tensions. India stands at a critical juncture, with its economic potential partially realized yet constrained by challenges such as low labor participation, import restrictions, and socio-political complexities. Despite raising its global economic share from 2% at independence to 7.93% in 2023, the nation''s future in the global economy hinges on balancing self-reliance with international economic integration.

Major Phases of Globalization in India

• Pre-Colonial Period (Ancient and Medieval India):
• Flourishing Trade: India was a major global trading hub, exporting spices, textiles, and gemstones via the Silk Road and Indian Ocean trade networks ( Fine Indian muslin was in great demand in Roman markets).
• Cultural Exchange: Buddhism spread from India to China, Japan, and Southeast Asia through trade and travel.
• Scientific Contributions: Indian knowledge, like the decimal system, spread globally via Arab traders.
• Colonial Era (18^th - 20^th Century):
• Economic Reconfiguration: India was transformed into a supplier of raw materials (e.g., cotton) for British industries.
• Example: Export of cotton and indigo to Britain while importing finished goods.
• Infrastructure Development: Railways and ports were developed but served colonial interests.
• Example: The Bombay port became a key trade hub for the British Empire.
• Post-Independence Protectionism (1947–1991):
• Economic Isolation: Focus on self-reliance under policies like import substitution and five-year plans.
• Example: Establishment of PSUs like BHEL and LIC for economic sovereignty.
• Limited Foreign Interaction: Trade and FDI were restricted; India was largely isolated from global markets.
• Challenges: Inefficient industries, low growth (termed the "Hindu rate of growth"), and weak exports.
• Economic Reforms and Liberalization (1991 Onwards):
• Trigger: A severe Balance of Payments Crisis led to sweeping reforms under the Narasimha Rao government, guided by Manmohan Singh.
• Key Policies:
• Reduction in tariffs and trade barriers.
• Allowing 100% FDI in certain sectors.
• Privatization and a shift to market-driven policies.
• Globalization in the 21st Century (Post-2000):
• Digital Integration: India emerged as a global IT outsourcing hub, providing services to Fortune 500 companies.
• Economic Partnerships: Increased role in multilateral platforms like the WTO, BRICS, and G20.
• Cultural Exchange: Bollywood movies and Indian cuisine gained global recognition. (Films like Slumdog Millionaire popularized Indian culture globally).
• Start-Up Revolution: Integration of Indian start-ups like Ola, Flipkart, and BYJU’s into the global ecosystem.
• Post-COVID-19 and Atmanirbhar Bharat:
• Economic Nationalism: The pandemic exposed supply chain vulnerabilities, leading to a push for self-reliance. (Promotion of local manufacturing under PLI schemes).
• Digital Globalization: Digital platforms like  Unified Payments Interface (UPI) have revolutionized global fintech systems. (UPI partnerships with countries like Singapore and UAE).

Positive Impacts of Globalization on India

• Economic Growth and Employment Generation: Globalization has significantly boosted India''s GDP growth by integrating it into global markets, enabling access to FDI, and expanding export-driven industries like IT and pharmaceuticals. 
• For instance, India’s IT exports reached $194 billion in FY 2023, making it the world''s largest IT outsourcing hub, while FDI inflows hit a record $83.57 billion in FY 2022. 
• This has created millions of jobs, particularly in urban centers like Bengaluru and Hyderabad.
• Technological Advancement and Innovation: Globalization has facilitated the influx of cutting-edge technologies, fostering innovation in sectors like space, healthcare, and fintech. 
• ISRO''s expertise and cost-effective launching technologies have attracted numerous foreign countries. Through its commercial divisions, ISRO has successfully launched around 430 foreign satellites for various nations.
• It achieved global acclaim with its Chandrayaan-3 mission in 2023, becoming the first country to land near the moon’s south pole. 
• Similarly, the adoption of digital payment systems, led by UPI, recorded 10.58 billion transactions in September 2023, showcasing India as a leader in financial technology.
• Improved Living Standards: The rise of globalization has elevated the standard of living for millions of Indians, particularly through access to global brands, better healthcare, and higher incomes. 
• While it took 75 years to reach a per capita income of $2,730, as per IMF projections, it will take only five years to add another $2,000.
• The strength of the middle class is expected to rise from 432 million people in 2020-21 to 715 million (47%) in 2030-31
• Cultural Exchange and Soft Power Enhancement: Globalization has amplified India’s cultural influence globally, promoting its art, cuisine, and traditions while embracing global diversity domestically. 
• Movies like Slumdog Millionaire, directed by a foreign director with music by A.R. Rahman, and RRR, which won an Oscar in 2023, have showcased India’s cinematic talent on the world stage. 
• Similarly, the international success of actors like Irrfan Khan, who starred in Spider-Man and Jurassic World, has further bolstered India’s cultural reach. 
• Additionally, the international acceptance of Indian cuisine has boosted tourism. 
• Rise in Entrepreneurship and Start-Up Ecosystem: Global integration has nurtured India’s start-up ecosystem, fostering innovation, funding, and global market access.
• India became the third-largest start-up hub globally.
• Indian startups raised over $2.3 billion in the first quarter of 2024 with initiatives like Start-Up India boosting entrepreneurial spirit among the youth.
• Strengthened International Trade and Economic Diplomacy: Globalization has transformed India into a trade powerhouse, enabling its integration into global supply chains. 
• India’s active participation in the G20 and FTAs (e.g., UAE CEPA in 2022) has enhanced its global economic influence and trade competitiveness.
• Improved Infrastructure and Urbanization: Globalization has driven investments in India’s infrastructure, modernizing cities and creating smart urban hubs. 
• India is developing 100 Smart Cities. Metro rail projects in cities like Delhi and Mumbai, supported by foreign technology, have enhanced urban mobility.
• Strengthened Defense and Strategic Capabilities: Globalization has enabled India to modernize its defense sector through international collaborations, enhancing its strategic standing. 
• The procurement of Rafale jets from France. Defence exports touched a record-high of Rs 21,083 crore in FY 2023-24
• Environmental Collaboration and Renewable Energy Growth: Globalization has fostered India’s collaboration in tackling climate change and boosting renewable energy capacity. 
• Initiatives like the International Solar Alliance (ISA), launched in partnership with 121 countries, position India as a leader in sustainable development.
• India alongside 8 countries (Argentina, Bangladesh, Brazil, Italy, Mauritius, Singapore, UAE, and USA), launched the unique multistakeholder Global Biofuels Alliance (GBA) during India''s G20 Presidency.

Challenges that Globalization Presents to India

• Widening Economic Inequality: Globalization has accelerated wealth concentration, benefiting urban elites while leaving rural and marginalized populations behind.
• The influx of foreign investments and market liberalization has disproportionately enriched skilled workers and corporations, sidelining unskilled labor. 
• A study reveals India''s wealth inequality, with the richest 1% holding 40% of total wealth. The 10,000 wealthiest individuals own 16,763 times the national average, while the top 1% average ₹54 million in wealth.
• The Gini coefficient, a measure of inequality, climbed to 0.402 in 2022-23, reflecting deepening disparities.
• Jobless Growth and Automation: Despite GDP growth, globalization has fostered automation and outsourcing, leading to stagnant job creation in labor-intensive sectors. 
• Industries like manufacturing and textiles are increasingly relying on mechanization, displacing unskilled workers. 
• The latest Annual PLFS report estimates the unemployment rate for youth aged 15-29 in India at 10.2% for 2023-24.
• Decline of Traditional Industries: Global competition has marginalized India’s traditional and small-scale industries, which lack the capital and technology to compete with global giants. 
• Handicrafts, handlooms, and small-scale industries are losing relevance as mass-produced imports dominate markets.
• For example, exports from India’s handloom sector declined by 30% immediately after Covid-19 pandemic, while millions of artisans faced reduced incomes due to cheaper machine-made alternatives from China.
• Overdependence on Global Supply Chains: Globalization has made India highly reliant on global supply chains, making it vulnerable to disruptions. 
• The Covid-19 pandemic and geopolitical tensions highlighted this dependence, particularly in critical sectors like pharmaceuticals and electronics. 
• For instance, India relies on China for 70% of active pharmaceutical ingredients (APIs), while the semiconductor imports in India rose 18.5% to Rs 1.71 lakh crore in 2023-24
• Cultural Homogenization: Global cultural dominance, driven by media and consumer goods, has diluted India’s indigenous cultural identity and values. 
• Western food habits, fashion, and media are increasingly replacing traditional practices, especially among urban youth. 
• For instance, according to a World Obesity Federation report, adult obesity in India has more than tripled, while the rise in childhood obesity is among the steepest globally, ranking behind only Vietnam and Namibia.
• Moreover, regional languages are declining, with AICTE data revealing that 3 to 4 colleges in West Bengal, Kerala, and Karnataka have discontinued their engineering courses offered in regional languages.
• Dependence on Foreign Capital: India’s integration into global financial systems has increased its reliance on volatile foreign investments, making its economy susceptible to global shocks. 
• Capital outflows during global downturns destabilize markets and depreciate the rupee. 
• India recorded the highest FPI outflow from the equity market in October 2024, totaling $10,428 million.
• Rising Cybersecurity Threats: Globalization has accelerated digital adoption, exposing India to cyberattacks and data breaches due to weak regulations. 
• With an increase in online transactions and data dependence, cybercrimes are on the rise. 
• In 2023, cyberattacks on India surged by 138%, targeting critical sectors like banking and healthcare (AIIMS Delhi Ransomware Attack). 
• The CoWIN data leak in 2023 exposed personal details of millions, highlighting the need for stringent data privacy laws.
• Loss of Agricultural Autonomy: Global trade agreements and corporate-driven globalization have increased dependency on imported agricultural inputs and volatile international markets. 
• The dominance of multinational corporations in agrochemicals and seeds has eroded traditional farming practices. For example, India imported 18.65 lakh tonne urea and 22.58 lakh tonne P&K fertilizers from China in 2023-24 
• Also, dependence on genetically modified seeds by global giants like Monsanto has marginalized indigenous seed varieties, reducing biodiversity and farmers’ autonomy.

Balance Globalisation with Push for Self Reliance

• Make in India and Make for the World: The Production Linked Incentive (PLI) scheme should be expanded to emerging sectors like semiconductors, green energy, and advanced materials.
• Encourage MNCs to set up manufacturing units in India while creating strong backward linkages with local MSMEs. 
• This ensures global technology adoption while fostering domestic production and employment. 
• Recent success in smartphone manufacturing under PLI highlights its scalability.
• Strengthen Research and Development (R&D) Ecosystems: Invest at least 2% of GDP in R&D to boost innovation, particularly in frontier technologies such as AI, biotechnology, and quantum computing. 
• Establish more public-private research parks, with global collaborations, to commercialize innovations at scale. 
• Initiatives like the India Semiconductor Mission need greater momentum with partnerships from tech leaders like Taiwan.
• This ensures global competitiveness without dependency. Linking research to industrial applications can help India move up the value chain.
• Build Resilient Supply Chains with Regional Partners: Diversify supply chains by forging deeper economic ties with countries like Vietnam, Indonesia, and South Korea.
• Create alternatives to China-centric supply chains, especially in critical sectors like rare earth elements and pharmaceuticals. 
• Participation in Quad and G20’s global value chain initiatives provides opportunities to balance dependencies. Domestically, invest in port and logistics infrastructure to ensure seamless trade integration.
• Focus on Skilling for Global Competitiveness: Develop specialized skill hubs to train the workforce in emerging industries such as renewable energy, robotics, and logistics. 
• The Skill India Mission can integrate with global apprenticeship programs through MOUs with developed nations. 
• As remote work grows, capitalize on India’s large IT pool to provide global services. 
• Facilitate foreign universities arrival in India as envisioned under National Education Policy 2020
• Promoting vocational training in rural areas ensures inclusivity in the global value chain, while also addressing domestic employment challenges.
• Enhance Agricultural Productivity and Export Competitiveness: Invest in agri-tech solutions like precision farming, drones, and blockchain to modernize the agriculture sector. 
• Promote export-oriented organic farming as India''s products are frequently rejected due to sanitary concerns, which ultimately damages the country''s image.
• Strengthen India’s farm-to-fork supply chains, integrating them with global export standards. 
• Leveraging recent trade agreements with the UAE and Australia can expand agricultural exports. 
• Develop a Green Growth Economy: Leverage India''s G20 presidency commitments to transition to a green economy, emphasizing renewable energy exports. 
• Collaborate with countries like Germany and Japan for tech transfer in clean energy. Strengthen domestic green industries to meet global Environmental, Social, and Governance (ESG) standards, boosting exports. 
• This strategy positions India as both a global leader and a self-reliant green economy.
• Digital Public Infrastructure for Global and Local Synergy: Scale up platforms like UPI and ONDC for global adoption, while enhancing domestic digital inclusion.
• Collaboration with countries in Africa and Southeast Asia for digital payment infrastructure builds India’s soft power and economic integration. 
• Domestically, ensuring robust data protection laws through frameworks like the Digital Personal Data Protection Act 2023 can safeguard sovereignty while enabling seamless global tech partnerships.
• Reform Trade Policies for Strategic Autonomy: Streamline trade policies to focus on sectors where India has comparative advantages, such as textiles, pharma, and IT services. 
• Implement tariff barriers selectively to protect nascent industries without stifling competition. Boost exports by reducing regulatory hurdles and aligning with global standards. 
• The Regional Comprehensive Economic Partnership (RCEP) could be reconsidered with protective safeguards for critical sectors to ensure mutual benefits.
• Financial Integration with Domestic Control: Strengthen global financial participation through rupee trade settlements with countries like Russia and the UAE. 
• Expand sovereign green bonds to attract global investors for developmental projects. Alongside, develop more cities like GIFT-IFSC in Gujarat.
• Concurrently, bolster domestic financial institutions like SIDBI and NABARD to meet the funding needs of MSMEs. 
• This hybrid model ensures robust financial integration while retaining strategic monetary autonomy.
• Focus on Balanced Urban-Rural Growth: Promote economic decentralization by strengthening Tier-II and Tier-III cities as manufacturing and innovation hubs. Integrate these with global markets through initiatives like Smart Cities Mission and AMRUT. 
• Enhance rural infrastructure via schemes like BharatNet to tap rural entrepreneurship for global e-commerce platforms. 
• This mitigates regional disparities while balancing globalization with self-reliance.

India''s economic journey, from 2% in 1947 to 7.93% global share in 2023, hinges on balancing self-reliance with globalization. While globalization offers opportunities, challenges like inequality, job losses, and cultural erosion persist. India must promote domestic manufacturing, build resilient supply chains, invest in R&D, and focus on skilling to harness global integration. A balanced approach, prioritizing strategic autonomy and domestic development, is crucial for unlocking India''s full potential in the globalized world.