Globalization of the Indian Economy: The Main Trends and Perspectives

Natalia V. Galistcheva – Doctor of Science in Economics, acting head of the department of the World Economy, MGIMO-University. 76 Prospect Vernadskogo, Moscow, 119454, Russia. E-mail: galistcheva@yandex.ru.
 
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The aim of this research is the analysis of the globalization model of the Indian economy, its main trends and perspectives. The article highlights the ways of India’s integration in the world economy –its participation in the international capital movement and in the international trade as well as its positions in global value chains.

The author examines the most representative definitions of globalization and draws attention that the theoretical basis of the study is the synthesis of the concept of global value chains and A.P. Thirlwall’s definition of globalization. The methodological basis of the study is such methods as induction and deduction, analysis and synthesis. The systematic approach to the overall study of the Indian economy and the Indian external economic policy in particular has become the base of this research.

The author underlines that according to the OECD data the Indian participation in global value chains is 42% of the Indian gross exports. At the same time India as a large economy has a less share of exports made of inputs taking part in vertical trade in comparison with other developing countries due to diversified national economy created during the import-substitution period.

The author notes Indian positions in international capital movement. The author stresses that the Indian contemporary investment policy is aimed at attracting foreign capital that doesn’t lead to the formation of external debt.
The article highlights the Indian positions in international trade of goods and services. The author examines the composition of Indian exports and imports as well as direction of Indian trade. The author draws attention to increasing the Indian positions in trade in intermediate goods. It proves the active participation of India in global value chains. The article presents statistical data on the Grubel-Lloyd Index which measures India and the world economy intra-industry trade as well as RCA coefficient which measures the comparative advantages of the Indian economy in trade both in goods and services.

The article also presents statistical data on the dynamics of the Indian external trade, foreign direct investments’ inflow and exports of the Indian capital.

Key words: Indian economy, liberal reforms, globalization, FDI to Indian economy, Indian exports of direct investments, Indian foreign trade, Indian positions in global value chains, humanitarian assistance of India, India as a new financial donor, Indian exports of services, coefficient of RCA in Indian foreign trade, «Act-East policy».

References
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DOI 10.24833/2071-8160-2017-2-53-71-89 (Read the article in PDF)