International trade began to assume in the 17th and 18th centuries.

The volume of trade which moved in international channels during 1947 is estimated to have been greater by at least 10 per cent than the 1946 volume and was probably slightly above the 1938 level.

94

96

98

100

102

104

106

108

110

1946 1947

volume

The level of world trade in 1957 reached the unprecedented figure of just over $100 billion, thus continuing the expansion that has been

characteristic of world trade for the past ten years.

In the course of these ten years, world exports have more than doubled from $46,800 million in 1947 to $102,000 million (preliminary figure) in 1957. 0

20,000

40,000

60,000

80,000

100,000

120,000

1947 1957

Exports

The increase over 1956 amounted to 11 per cent.

Two main forces contributed to the increase:

1. world industrial production which increased by four per cent; and

2. the prices of goods, which increased by five per cent.

As in 1956, the main expansion was due to greater exports of the industrial countries, which are the world's largest traders,

Globalization: Integrating and merging of the distinct world markets into a single market……..

Economic Revenue/GDP the global trade which was just 12% of the world GDP in 1962

increased to 30% of the world GDP in 1993.

Levis jeans

The four stages

1. Domestic in focus 2. Home focus, but with exports

(ethnocentric). 3. Adapt stage two organizations marketing

mixes to overseas operations. The focus switches to multinational (polycentric) and adaption becomes paramount.

4. Global organizations which create value by extending products and programmes and focus on serving emerging global markets (geocentric)

International trade theory

To predict patterns of trade and to analyze the effects of trade policies.

1. Ricardian model: countries specialize in producing what

they produce best 2. Heckscher-ohlin model:. It predicts that countries will

export those goods that make intensive use of locally abundant factors and will import goods that make intensive use of factors that are locally scarce.

3. New trade theory: most trade is between countries with similar factor endowment and productivity levels, and the large amount of multinational production (ie foreign direct investment) which exists.

4. Gravity model of trade: The gravity model, in its basic form,

predicts trade based on the distance between countries and the interaction of the countries' economic

sizes

Top Ten Exports (Products )

Rank Name of Commodity Apr 2006 -

Feb 2007

Export Value of Goods

%Growth %Share

Value (INR in Crores)

Value (INR in Crores)

Value (INR in Crores)

1 INDIA EXPORT OF PETROLEUM (CRUDE & PRODUCTS)

76,683.05 63.10 15.02

2 INDIA EXPORT OF GEMS & JEWELLARY

62,586.53 1.98 12.26

3 INDIA EXPORT OF RMG COTTON INCL ACCESSORIES

27,520.53 7.77 5.39

4 INDIA EXPORT OF MACHINERY AND

INSTRUMENTS

26,512.59 34.08 5.19

5 INDIA EXPORT OF DRUGS,PHRMCUTES & FINE

CHEMLS

21,833.63 11.66 4.28

6 INDIA EXPORT OF MANUFACTURES OF

METALS

20,156.05 20.88 3.95

7 INDIA EXPORT OF TRANSPORT

EQUIPMENTS

19,064.44 16.43 3.73

8 INDIA EXPORT OF PRMRY & SEMI-FNSHD

IRON & STL

17,856.68 53.39 3.50

9 INDIAN EXPORTS OF COTTON YARNS, FABRICS, MADE

UPSETC

16,682.33 6.67 3.27

10 INDIA EXPORT OF IRON ORE

15,074.03 3.92 2.95

12.26

15.02

3.732.95

4.28

0

2

4

6

8

10

12

14

16

G&J PETRO Transport Iron Ore Drugs

% of share

Rank Name of Commodity Apr 2006 -

Feb 2007

Export Value of Goods

%Growth %Share

Value (INR in Crores)

Value (INR in Crores)

Value (INR in Crores)

1 India Import Of - PETROLEUM, CRUDE

& PRODUCTS

236,601.84 34.47 32.10

2 India Import Of - ELECTRONIC GOODS

65,281.46 25.32 8.86

3 India Import Of - GOLD 58,704.81 37.35 7.97

4 India Import Of - MACHRY EXCPT

ELEC & ELECTRONIC

56,216.24 43.37 7.63

5 India Import Of - PERLS STONES

30,061.51 -21.37 4.08

Top Import (Products)

6 India Import Of – IRON & STEEL

24,413.75 40.20 3.31

7. India Import Of - ORGANIC

CHEMICALS

22,405.24 18.93 3.04

8. India Import Of - COAL,COKE &

BRIQUITTES ETC

18,363.64 19.77 2.49

9. India Import Of - OTHER

COMMODITIES

18,258.34 -22.47 2.48

10 India Import of- Wheat

1,417.61 - 0.19

32.1

8.86

4.083.04 2.49

0

5

10

15

20

25

30

35

Petroleum Electronic Perals Organic Che coal, cokee

% of Share

India & Global Trade: India had a significant share in the

world trade at the time of independence. However, since then there was a secular decline in India’s share in the world exports till 1980. since from 1950 to 1980 the percentage declined from 2 to 0.4. it has, how ever improved to about 0.8 by 1997 and is expected to reach one percent by 2000.

00.20.40.60.8

11.21.41.61.8

2

1950 1980 1997

percent

India’s Global shareFactor India’s share (percentage)

Area 2.47

Arable land 11.24

Population 16.78

GNP 1.50

GNP at purchasing power parity

5.45

FDI 0.5

Merchandise exports 0.7

Merchandise imports 0.8

Service exports 1.2

Service imports 1.4

India’s share of Developing Countries

Factor India’s share (performance)

Population 19.72

GNP 7.43

GNP at purchasing power parity 12.13

FDI 1.6

Merchandise exports 2.42

Merchandise imports 3.07

India’s Rank

Factor Rank Factor Rank

Population 2 Milk production 1

Area 7 Butter and ghee production 1

Arable land 2 Sugar production 2

Irrigation area 1 Merchandise exports 31

Tractors in use 2 Merchandise imports 26

Nitro fertiliser consumption 2 Service exports 22

Rice production 2 Service imports 19

Wheat production 2 GNP 12

Tobacco production 2 GNP at purchasing power parity

4

Tea production 1

Indices of Global Competitiveness

Growth competitiveness

Government express

Regulatory standard

Export promotion

Average tariff

Investment rates

Overall infrastructure

Technological sophistication

E- commerce

India 49 19 49 5 59 14 54 38 51

USA 1 25 5 26 15 41 7 1 1

Singapore 2 13 15 1 2 4 1 8 10

Finland 6 52 8 43 17 46 2 2 7

Canada 7 42 12 7 29 47 11 13 3

Hong Kong 8 2 25 45 1 11 8 18 20

UK 9 40 10 16 26 54 22 15 8

Switzerland 10 38 11 44 10 43 4 9 13

conclusion

Imports> Exports:Developing Country: