Globalization:

• The International Monetary Fund(IMF) defined globalization as a growing economic interdependence of countries worldwide through the increasing volume and variety of cross-border transactions in goods and services, free international capital laws and more rapid and widespread diffusion of technology.

Purposes/Motive of Globalization:

• Sales expansion
• Acquisition of resources like labour, capital, components, land, technology and information
• Diversification of sales and supply of sources so as to minimize swings in sales and overdependence on suppliers
• To minimize competitive risks for defensive purpose.

Globalization can be in the following forms:

• Industrial globalization-rise and expansion of multinational companies(MNCs)
• Financial globalization-emergence of worldwide financial markets and better access to external financing for corporate, national and sub-national borrowers
• Political globalization-the spread of political interests to the regions and countries outside the neighbourhood
• Informational globalization-the increase in information flow between geographically remote locations
• Cultural globalization-the growth of cross-cultural contacts

Salient Point:

• With globalization, countries are integrated and heavily dependent on each other for all sorts of transactions.
• Globalization results in economic, cultural, technological and legal changes in the global market.