Importance of foreign trade for India from "summary" of Oswaal NCERT One For All for UPSC & State PSC's Indian Economy Classes-9 to 12 (Old & New NCERT Edition) (For 2023 Exam) by Oswaal Editorial Board
Foreign trade plays a crucial role in the economic development of India. It refers to the exchange of goods and services between countries. India is a diverse country with a rich cultural heritage and abundant resources. Foreign trade allows India to showcase its products on a global platform and tap into international markets. One of the key benefits of foreign trade for India is the expansion of markets. By engaging in trade with other countries, India can reach a wider customer base and increase its sales. This leads to higher profits for Indian businesses and boosts the overall economy. Additionally, foreign trade helps in diversifying the sources of goods and services, reducing dependency on a single market or supplier. Moreover, foreign trade promotes competition and innovation in the domestic market. When Indian businesses face competition from foreign companies, they are motivated to improve the quality of their products and services. This fosters innovation and technological advancement, ultimately benefiting the consumers. Furthermore, foreign trade encourages specialization and efficiency, as countries can focus on producing goods and services in which they have a comparative advantage. Foreign trade also plays a vital role in attracting foreign direct investment (FDI) to India. When foreign companies invest in Indian businesses, it leads to the transfer of technology, expertise, and capital. This helps in modernizing the Indian economy and creating employment opportunities. FDI also boosts infrastructure development and contributes to the overall growth of the country.- Foreign trade is essential for India's economic growth and development. It allows the country to expand its markets, promote competition and innovation, attract foreign investment, and enhance its overall competitiveness on the global stage. By actively participating in international trade, India can leverage its strengths and resources to achieve sustainable economic prosperity.
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