Role of MNCs in India ~ Group Discussion/Lecturette Topic | SSBMADEEASY


In presentScenario the FDI in all the sectors are increased by the government also theForeign Companies are to be set up. These have some positive and negativeeffects on Consumers and Economy. All the relevant info are uploaded in thetoday’s post.

a)     Consumer
b)     Economy
c)      MNCsThemselves

In the early 90s our planners decided toopen up the economy. With Liberalization and Globalization, many MNCs enteredthe Indian market, which brought a huge change in the economic front. Todaythere are large numbers of MNCs that are operating in Indian markets. They arepresent in almost every sector of our economy. Recently they have entered inthe sector of outsourcing that is commonly called as Call Centers. MNCs havedemerits and merits both on our economy, but will the changing scenarioglobally, they are the need of time.


        The consumer is one happy lot after the MNCs entered our market. Todayevery item from shoes to cars, from Pepsi to Mc Donald’s is available to them.The consumers have a wide variety to choose from. Take shoes for example. A fewyears back we only had Bata. Today we have Nike, Woodland, Red Tape and Reeboketc. The cost is very competitive and the quality has improved.


·        Negativeeffect: Under the influence of globalization, most developed countries,instead of controlling the activity of MNCs are inviting them to invest incrucial sectors of their economy. Some feel that the rich countries arepreparing a debt-trap for the poor countries. They provide poor countriesassistance in the condition of introduction of liberalization an globalization,which makes way for functioning of MNCs. This increases the production ofcertain products. Exports also increase but imports increase more than theexports and that leads to a balance of payment problem. At critical moments,foreign forces strike again, capital starts to fly, value of domestic currencystarts falling. Again the international agencies come to help with more strictterms and conditions and the helpless country becomes a victim and gets into avicious circle from where it is not easy to come out.
·        Positiveeffects:  the technology that theMNCs bring with them is not just that of a product, but also of management ofan enterprise, R & D, marketing, HRD, finance services and every otheraspects of the enterprise. This is also an asset that remains with country. In thecase of India, the number of hobs offered by the MNCs rose from 41,161 in 1994to 44,053 in 1995 ( A rise of 3.84%)

MNCs itself

The MNCs come into anycountry with an aim of making profit. They invest heavily in setting up aproject. They are also more powerful than any government on the earth. It isalso feared that people in developing countries may have to leave theirtraditional professions and depend on the jobs and products created by themodern capitalist institutions. It is pointed out that MNC investment islimited essentially to the supply  ofsecond hand plant and machinery which is declared obsolete in their country.Ultimately nations have to depend on their own capabilities to achieveprogress. Respect has to be earned through demonstration of independence,competence and clear sense of purpose. The MNCs cannot provide development bythemselves. They can only provide helping hand to the process of growth.

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Deepak Tomar

I’m Deepak Tomar. I have completed my M.Tech in Computer Science and now i am working as a Govt. Employee in UP Police, I Love to help others and making friends, you can connect to me on facebook for any help- I will be happy to help you .

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