In the contemporary global landscape, the intricate relationship between globalization and new technology is particularly pronounced, especially in the context of a world grappling with scarce resources. Globalization, characterized by the interconnectedness of economies, cultures, and societies, has been significantly propelled by advancements in technology. This symbiotic relationship has ushered in an era of rapid information exchange, increased trade, and enhanced communication. In a world marked by the scarcity of resources, technology has played a pivotal role in optimizing resource utilization and fostering sustainable practices.
In India, a nation witnessing the convergence of globalization and technological innovation, the impact on resource management is noteworthy. The adoption of digital technologies has not only accelerated economic growth but has also facilitated efficient resource allocation in sectors such as agriculture, energy, and healthcare. The globalization of markets has opened up new avenues for trade and investment, enabling India to harness external resources and expertise to address domestic challenges.
However, the dual forces of globalization and technology have also presented challenges. The relentless pursuit of economic growth and technological advancements can exacerbate resource scarcity, leading to environmental degradation and social inequality. In the Indian context, striking a balance between reaping the benefits of globalization and ensuring equitable access to resources remains a critical imperative.
UPSC Mains General Studies Paper – 1 Mains 2022
Factors responsible for the location of primary, secondary, and tertiary sector industries in various parts of the world including India.
UPSC Mains Civil Services IAS Exam Question Paper – 2022
Approach:
- Start with basics examining globalization and new technology.
- Discuss the relationship between globalization and new technology, in the context of scarce resources.
- Conclusion/way forward accordingly.
Introduction:
Globalization refers to the increasing interconnectedness of the world’s economies, societies, and cultures through the expansion of cross-border trade, investment, and the flow of people and technology. It has resulted in the integration of national economies into a global economy and has allowed for increased economic growth, increased access to goods and services, and greater cultural exchange. It is important to carefully manage the relationship between globalization, new technology, and scarce resources to maximize the positive impacts and minimize the negative ones.
Body:
The Indian small-scale industry is playing an imperative role in the economic expansion of the country and has a vast approach to employment generation. Increasing small-scale sector units also results in decentralized industrial development, better distribution of wealth and investment, and entrepreneurial talent. The government has initiated several policies for the growth and development of small-scale industries. Post-liberalization economic conditions have created immense growth prospects for small-scale industries. The Micro, Small, and Medium Enterprises in India are acting as the power and spirit of economic growth in the 21st century.
The relationship between globalization and new technology, in the context of scarce resources references to India:
The relations between globalization and new technology in the world of scarce resources have varied facets with their pros and cons. The positives and negatives both impact the relationship between globalization and new technology.
Positive Impact:
- Invasion of foreign investment and technology: The Small-scale industries (SSIs) in India suffer from outdated technology and sub-optimal scale of operation. Many foreign companies have ended up with Indian SSIs which helped them to use better technology, managerial skills, etc.
- Opportunities to enter the world markets: Globalisation has opened up the economy and integrated it with the world economy. The global industry enjoys the benefits of selling its products and services to the world market rather than being confined to the domestic market. The free economy ushers inaccessibility to bigger markets, greater linkages for SMEs with larger companies and marketing outfits, and improved manufacturing techniques and processes.
- Expanding the areas of business: Technology has been able to identify many uncommon but highly promising business areas like outsourcing, medical transcription, clinical research trials, subcontracting, Ancillarisation, and many new technologies like biotechnology, nanotechnology, etc which are attractive for the new generation depending on technology and globalization.
- Free flow of capital: In a liberalized economy, banks would try to find out new avenues of giving credit to increase their profitability. Thus, the supply of funds may be easier. Development in the money market would initiate development in the capital market
- Less procedural problem: As the economy is mainly market-driven; there is less Govt. intervention, red tape, less control on import and export, etc. The technology would be allowed to work in a free environment.
- Opportunities for generation of employment: Being labor-intensive, the technology makes significant contributions to employment generation and expanding industrial networks in rural areas.This sector nurtures the traditional skills and knowledge-based small and cottage industries.
Negative impact
- Though there are many benefits derived from the process of Globalisation, it has resulted in some serious constraints on the growth of the industry in India. The Indian and world industries face ruthless competition from large domestic firms and multinationals armed with improved technology, managerial ability, skilled workers, marketing skills, better product quality, and a wide range of products.
- Problems related to finance: Financing has always been a major problem for the small and medium industries in India. The SSIs mostly depend on internal sources of finance (personal savings, loans from relatives, and loans from local money lenders) rather than on institutional financing by banks and other financing institutions.
- Poor Technology Base: There exists considerable heterogeneity among the SSIs in India. A small percentage of firms operate with sophisticated technology bases whereas the majority of firms use outdated technology. They suffer from low productivity and poor product quality. Due to their small size, they cannot enjoy large-scale production economies.
- Inadequate infrastructure facility: Infrastructural lacking includes inadequate power supply, transportation, water supply, etc. Small firms cannot bear the cost of setting up an independent power supply unit. They have to depend on irregular power supply from the electricity boards. An inadequate transportation system increases the cost of production.
- Shortage of Skilled Workers: Though India has no shortage of human resources, most of them are unskilled workers. Large firms pay higher remuneration and employ skilled workers. The SSIs have to operate with unskilled or semi-skilled workers. Thus, SSIs suffer from low managerial capabilities.
- Problems of Marketing and Distribution: Marketing is probably the most neglected and less explored problem for Micro and Small firms. There are many low-cost marketing techniques that SSIs can utilize, such as social media marketing, email marketing, and content marketing. SSIS need to understand the importance of marketing and allocate resources to develop their marketing capabilities to stay competitive in today’s market.
Conclusion:
Hence, technological progress is a key driver of improvements in incomes and standards of living. But new knowledge and technologies do not necessarily develop everywhere and at the same time. In India, the impact of globalization and new technology on the world of scarce resources has been particularly pronounced. India is a rapidly industrializing country with a large and growing population, and this has put a strain on its natural resources. Therefore, the way technology spreads across countries is central to how global growth is generated and shared across countries.
Frequently Asked Questions (FAQs)
1. How does globalization impact the adoption of new technology in India, considering its scarce resources?
Answer: Globalization has significantly influenced the adoption of new technology in India, even in the face of scarce resources. The interconnectedness fostered by globalization allows India to access and integrate advanced technologies from around the world. While this presents opportunities for technological advancement, it also poses challenges due to the scarcity of resources. The influx of technology often requires substantial investments in infrastructure, education, and research. Striking a balance between adopting new technologies to enhance productivity and managing scarce resources effectively becomes crucial for sustainable development.
2. In what ways do new technologies contribute to India’s participation in the global economy, and how does it impact resource allocation domestically?
Answer: New technologies play a pivotal role in India’s integration into the global economy. The use of cutting-edge technologies enhances productivity, facilitates efficient communication, and allows Indian businesses to participate in global value chains. However, this increased connectivity and participation also affect domestic resource allocation. As industries adopt automation and digitization, there is a shift in resource requirements. Skill development becomes imperative to harness the benefits of technology, and policymakers must navigate the challenge of reallocating resources to ensure inclusive growth and mitigate potential disparities.
3. Can globalization and new technology address the challenges of resource scarcity in India, or do they exacerbate existing inequalities?
Answer: Globalization and new technology have the potential to address resource scarcity in India, but their impact is nuanced. On one hand, technology can drive resource efficiency, optimize production processes, and offer innovative solutions to scarcity challenges. On the other hand, globalization may lead to increased competition for resources and exacerbate existing inequalities. It is crucial for India to strategically leverage technology for sustainable development, ensuring that advancements benefit all segments of the population. Policies promoting inclusive access to education, technology, and opportunities can help mitigate disparities and harness the positive aspects of globalization and technological progress.
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