GLOBALIZATION

Contents
• What is globalization
• Effects of globalization
• Globalization in India
• Merits and Demerits of globalization
• Impact on education
• Challenges of globalization on higher education
• Conclusion
Globalization
Globalization is the system of
interaction among the countries
of the world in order to develop
the global economy.
Globalization refers to the
integration of economics and
societies all over the world.
Globalization involves
technological, economic,
political, and cultural exchanges
made possible largely by
advances in communication,
transportation, and
infrastructure.
 There are two types of integration—negative and positive.

Negative integration is the breaking down of trade barriers or protective

barriers such as tariffs and quotas. For example, by eliminating barriers, the
costs of imported raw materials will go down and the supply will increase,
making it cheaper to produce the final products for export (like electronics,
car parts, and clothes).

Positive integration on the other hand aims at standardizing international

economic laws and policies. For example, a country which has its own policies
on taxation trades with a country with its own set of policies on tariffs.
Likewise, these countries have their own policies on tariffs. With positive
integration (and the continuing growth of the influence of globalization),
these countries will work on having similar or identical policies on tariffs.
 Effects of Globalization
It is easy to identify the changes brought by globalization.

•    Improvement of International Trade. Because of globalization, the number

of countries where products can be sold or purchased has increased dramatically.

•   Technological Progress. Because of the need to compete and be competitive

globally, governments have upgraded their level of technology.

•   Increasing Influence of Multinational Companies. A company that has

subsidiaries in various countries is called a multinational. Often, the head office is
found in the country where the company was established.
• The rise of multinational corporations began after World War II. Large companies
refer to the countries where their subsidiaries reside as host countries.
Globalization has a lot to do with the rise of multinational corporations.

•    Power of the WTO, IMF, and WB. According to experts, another effect of
globalization is the strengthening power and influence of international institutions
such as the World Trade Organization (WTO), International Monetary Fund (IMF),
and World Bank (WB).
• Greater Mobility of Human Resources across Countries. Globalization allows
countries to source their manpower in countries with cheap labor. For instance,
the manpower shortages in Taiwan, South Korea, and Malaysia provide
opportunities for labor exporting countries such as the Philippines to bring their
human resources to those countries for employment.

•   Greater Outsourcing of Business Processes to Other Countries. China, India,

and the Philippines are tremendously benefiting from this trend of global business
outsourcing. Global companies in the US and Europe take advantage of the
cheaper labor and highly-skilled workers that countries like India and the
Philippines can offer

• Civil Society. An important trend in globalization is the increasing influence and

broadening scope of the global civil society.
Civil society often refers to NGOs (nongovernment organizations). There are
institutions in a country that are established and run by citizens. The family, being
an institution, is part of the society. In globalization, global civil society refers to
organizations that advocate certain issue or cause.
 Globalization in India
• In early 1990s the Indian economy had witnessed dramatic policy changes. The
idea behind the new economic model known as Liberalization, Privatization and
Globalization in India (LPG), was to make the Indian economy one of the fastest
growing economies in the world. An array of reforms was initiated with regard to
industrial, trade and social sector to make the economy more competitive. The
economic changes initiated have had a dramatic effect on the overall growth of
the economy. It also herald the integration of the Indian economy into the global
economy. Then the following measures were taken to liberalize and globalize the
economy.
1. Devaluation: To solve the balance of payment problem Indian currency were
devaluated by 18 to 19%.
2. Disinvestment: To make the LPG model smooth many of the public sectors
were sold to the private sector.
3. Allowing Foreign Direct Investment (FDI): FDI was allowed in a wide range of
sectors such as Insurance (26%), defense industries (26%) etc.
4. NRI Scheme: The facilities which were available to foreign investors were also
given to NRI's.
 Merits and Demerits of Globalization
• The Merits of Globalization are as follows:

• There is an International market for companies and for consumers there is a wider
range of products to choose from.
• Increase in flow of investments from developed countries to developing countries,
which can be used for economic reconstruction.
• Greater and faster flow of information between countries and greater cultural
interaction has helped to overcome cultural barriers.
• Technological development has resulted in reverse brain drain in developing
countries.

• The Demerits of Globalization are as follows:

• The outsourcing of jobs to developing countries has resulted in loss of jobs in

developed countries.
• There is a greater threat of spread of communicable diseases.
• There is an underlying threat of multinational corporations with immense power
ruling the globe.
• For smaller developing nations at the receiving end, it could indirectly lead to a
subtle form of colonization.
 Globalization: Impact on Education
• Globalization has a multi-dimensional impact on the system of education. It has
underlined the need for reforms in the educational system with particular
reference to the wider utilization of information technology, giving productivity
dimension to education and emphasis on its research and development activities.

• Education is an important investment in building human capital that is a driver for

technological innovation and economic growth. It is only through improving the
educational status of a society that the multi-faceted development of its people
can be ensured. In the post-industrialized world, the advanced countries used to
derive the major proportion of their national income not from agriculture and
industry but from the service sector. Since the service sector is based on imparting
skills or training to the students and youth, the education sector is the most
sought after. It must provide gainful employment so that the sector is developed
in a big way. It has also given rise to controversies relating to introducing changes
in the inter-sectoral priorities in the allocation of resources leading to the
misconceived policy of downsizing of higher education. It has also advocated
privatization of higher education without realizing the danger of making the
system a commercial enterprise.
• The principal objective of education has been the development of the whole individual.
The minimum level of education that was necessary to achieve this goal in the society
was basic or primary and in the industrial age, secondary. In the present borderless
information society, education needs to be able to respond to additional demands of a
rapidly globalizing world by raising awareness of environment, peace, cultural and social
diversity, increased competitiveness, and the concept of a global village. Such education
is to a knowledge or information society what secondary education was to an industrial
economy.

• Education prepares the individual to connect - and live in harmony - with the
environment around him. Globalization has changed the size, nature and quality of that
environment. The challenge for higher education, therefore, is to reform, create and
develop systems that prepare the individual to work in a borderless economy and live in a
global society. In other words, our educational institutions need to produce global
citizens.

• The withdrawal of state from higher education has also been helped by economists, who
have had an overly simple way of assessing the return on investments in higher
education. The basic problem is that they have measured the return on education
exclusively through wage differentials. With reference to someone who has no education,
someone who has been to primary school, someone who has completed secondary
school, and someone with a university degree, one can ask how much more each earns
than the previous. These differences are then compared to the incremental amounts
invested in their education to find the return. The results generally suggest that higher
education yields a lower return than primary or secondary
• One of the major consequences of the globalization of education has been co
modification and the corporatization of institutions of higher learning. It is said
that the for-profit education market in the United States is worth more than $500
billion in revenue for the involved corporate. More than one thousand state
schools have been handed over to corporations to be run as businesses. But there
is a fundamental problem with the way business models have been applied to the
delivery of education and other public goods. Unthinking adoption of the private
sector model prevents the development of a meaningful approach to
management in the public services in general or to the social services in particular
based on their distinctive purposes, conditions and objectives.

• There is another, more serious, problem with corporatization of education.

Corporations operate on the principles of cost reduction and profit maximization.
These require introducing standardization and the packaging of product in
compact, measurable configuration. Applied to education, these approaches
would possibly negate its basic fabric and purpose. Education has always
encouraged and represents openness, inquiry, diversity, research and limitless
learning.
Challenges of Globalization on Indian
Higher Education
No doubt, Higher Education has attained a key position in the knowledge society
under globalized economy. However, the challenges faced are immense and far-
reaching.
Its impact on the clients viz., Individuals, Institutions, Systems and Societies is
not only not clear but also not comprehendible at this moment unless it is
viewed in the context of various other actors that are simultaneously operating
on the higher education system.
It is assumed that globalization promises dramatic and rewarding change to the
higher education systems, of societies, which are relatively stable in their
political, social and institutional make up, while for the others, it may threaten
the very stability needed to build well performing higher education system.
It is also true, that so far globalization has given the advanced economies a
huge advantage as they had made enough preparation prior to its launching
while others are caught in the trap without any preparation
 Globalization - Challenge or an
Opportunity
Two of the strategic and long-term questions that Globalization poses to t he higher
education system are:
(i) ‘Commoditization’ - the use of knowledge as a purchasable and
saleable good.
(ii) ‘Alternative providers’ with profit motive of higher education’s landscape
that are engaged in the transmission of knowledge using Information and Communication
Technologies.

Displacing and reinterpreting knowledge raise fundamental questions to the

Universities, more so, in the area of autonomy and academic freedom. They also pose questions
with regard t o the very objectives of Higher Education system in terms of its ethical obligation
to make knowledge freely available to those who seek for it. The apprehension is, that the
globalization, may herald a basic change in the very role that the Universities play in the
society. Defining universities simply as ‘service providers’ and changing their responsibility to
the society for the shorter gains, may in the long run, ruin the very objectives with which
the Universities were established. The dynamics of Globalization is no doubt a challenge as well as an
opportunity.

•
 Commitments Under GATS

The general procedure of commitment under GATS is that “countries submit

their Schedules under five sub sectors of education and four modes of supply of
education”

The five sub-sectors are: Primary Education; Secondary Education; Higher

Education; Adult Education and Other Education. The four modes of supply of
education are Cross-Boarder Supply; Consumption Abroad; Commercial
Presence/Franchisee and Twining Programmers. The idea behind this is the
creation of an open, global marketplace where services, like education, can be
traded to the highest bidder. GATS cover t he educational services of all
countries whose educational systems are not exclusively provided by t he public
sector, or those educational systems that have commercial purposes. Since total
public monopolies in education are extremely rare, almost all of t he world's
educational systems fall under the GATS umbrella. In India, we cannot get
exemption in education from the application of GATS because education at
all levels, particularly at higher education level, is not entirely free (i.e. some fees
has to be paid).
Present Scenario of Higher Education
In India
As on today we have more than 300 universities, institutions of higher learning
and deemed universities, out of which 95 deemed to be universities, 13
institutions of national Importance, 19 central universities, 203 state universities, 5
institutions established under state Education legislation act and about 16,885
colleges including 203 Autonomous colleges.

System has increased fourteen-fold in terms of the number of universities and

thirty three-fold in terms of the number of colleges, in comparison to the number at
the time of Independence.
At the beginning of the academic year 2004, the total number of students
enrolled in the formal system of education in universities and college s was 99.53
lakh- 12.97 lakh (13.3 per cent) in university departments and 86.57 lakh (86.97%)
in affiliated colleges and 4.37 teaching Faculty employed making India’s system of
higher education the second largest in the world. “To finance t his expansion,
the Government of India has consistently increased its share in the total
expenditure on higher education—from 49.1 percent in 1950–51 to more than 90
percent today.
In addition , there are other issues, which need consideration in
the context of globalization of Indian higher education
system. The issues can be classified in Socio-Economic,
Political and Academic categories. Much has already been
said in the socio-economic category, however there are
political dimensions to trade in services. The sovereignty of the
stat e to take decision with regard to free provision of these
services, as well as location of these services in difficult areas
even if economically inefficient is the issue. Education being on
the concurrent list, the states’ acceptance becomes essential
this would call for amendments in the Education Acts of the
states and universities.
 Conclusion
To convert t he threat into an opportunit y it is essential to
concentrate on:

I. Urbanization of Rural areas i.e. provide all those facilities to rural

mass;
II. Nationalization prior to Globalization;
III. Equalization of access and opportunities;
IV. Decentralization of powers to the stakehol ders;
V. Qualification of existing institutions to the international standards.
THANK YOU