[Answered]What is de-globalisation? Discuss its consequences and impact on India.

Demand of the question

Introduction. What is de-globalisation?

Body. Discuss reasons for rising tendency towards de-globalisation by some countries. Mention impact of de-globalisation on India.

Conclusion. Way forward.

De-globalisation is the process of diminishing interdependence and integration between nations around the world. It is characterised by decline in economic trade and investment between countries. This decline reflects that economies become less integrated with the rest of the world economies with rise in tendencies of protectionism.

Reasons for rising tendency towards de-globalisation by some countries:

  1. Rise of Asia: Developing nations like India, China and Japan have grown rapidly over the last few decades. The economic power has been shifting from the West to these Asian Nations. Thus, developed nations have started turning inward in order to put a check on the rise of other powers.
  2. Protectionism: Although western nations have benefitted immensely from globalisation by expanding the reach of their economy and by the acquisition of talented individuals, public support towards it has been waning fast. Developed nations think they have more to lose than to gain. The people of these nations are worried about the consequences of globalisation like loss of employment, increased migration and crimes etc.
  3. Security concerns: One of perceived consequences of globalisation is rising security concerns. Increased exchange and mutual trade between nations have made it increasingly tough to maintain global security. Each terrorist attack that takes place in these developed nations brings more people in support of de-globalisation. The Financial Times data collected by the United Nations claims that a million fewer people a year aremoving to another country on average every yearafter 2010.This further reduces the free movement of goods and people.
  4. Refugee crisis: Another factor that plays a role in support of de-globalisation is the refugee The constant unrest in western Asian nations has caused a severe refugee crisis. The majority of the citizens from these nations have taken refuge, legally or illegally in European nations. This is a huge cause of concern for these debt-stricken economies. As these economies are unable to grow and create enough employment opportunities for their own people, the voice against globalisation grows stronger.

Impact of de-globalisation on India:

Economic impact

1.       Growth: De-globalisation will lead to reduction in the rate of economic growth of India. It will lead to protectionism with reduced cooperation among countries that will hurt Indian trade and exports. In the successive monetary policies in 2018-19, RBI has observed that protectionism poses a challenge to India’s growth rate, because it affects the demand of Indian exports, especially in the textile, pharmaceutical, gems-jewellery and service sector.

2.       Competition: De-globalisation will lead to reduction in competition and rise in general prices of the goods and services. For example, Brexit will give rise to higher tariffs and quotas that will have an impact on British business as well as on the rest of the world leading to price rise.

3.       Employment: It will destroy employment opportunities as it will prevent outflow of skilled people due to protectionist measures like visa regulations. This will impact their employability and remittance to the nation. Recently, the USA has increased H1B visa norms stringent to Indians, as Indians are occupying major posts in the USA.

4.       Increased costs: It may lead to increased import costs due to lesser choice and options and manufacturers and producers would have to pay more for equipment, commodities, and intermediate products from foreign markets.

Social impact

It will lead to decrease in standards of living as it will impact exports and economic growth impacting welfare of poor and their standard of lives. It may further lead to rise in conflicts economically and politically.

Political impact

It would affect polity leading to instability in the political framework of nations due to rise in prices and cost of living may lead to civil unrest.


Hinder technological development

These tendencies limit technological advancement of the world as a whole and of developing countries in particular. Limited knowledge sharing, lack of flow of technology to developing countries limit advancement in science.

Impact on Environmental conversation

1.       Due to non-cooperation among nations it will impact environment conservation efforts in India.

2.       It will reduce required funding and would jeopardise efforts to conserve environment and tackle environment change.

3.       It would lead to lack of coordination at international organisations like UN where countries may not come at a common point to various problems like environmental change.

Impact on women empowermentDe-globalisation would impact women empowerment efforts as it will impact women movements across the globe. Lack of coordination will reduce opportunities for women across the world.
Impact on securityDue to lack of coordination among various nations, security around the world along with India would impact. It will not only increase economic risks, but would provide an opportunity for terrorists to carry out violence due to lack of coordination among various law enforcement agencies.
Impact on agriculture1.       A less coordinating world means impact on agricultural exports and Indian farmers. Indian farmers would face double whammy of environment change and de-globalisation.

2.       It will impact economic development in India and would hurt the welfare of Indian farmers.

Multiple factors are causing this shift from globalisation to de-globalisation. As economic power shifts from the Western to Asian nations, the U.S. and the U.K. have adopted self-protection policies. Rising security concerns and refugee crisis also play a role in creating support for de-globalisation. What is required is to develop self-sufficiencies so as to prevent major impact of such tendencies.

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