Liberalisation of Foreign Trade and Foreign Investment Policy


 
 
Concept Explanation
 

Liberalisation of Foreign Trade and Foreign Investment Policy

Liberalisation of Foreign Trade and foreign Investment Policy: To protect local entrepreneurs from competition, the government of a country put certain barriers to restrict the entry of foreign goods. Liberalisation of trade and investment policies has helped the globalisation process by making foreign trade and investment easier. Thus, liberalisation has led to a further spread of globalisation because now businesses are allowed to make their own decisions on imports and exports

For example, if the Indian Government puts a tax on import of toys, buyers will have to pay a higher price on imported toys. So, toys imported from other countries will no longer be cheap in the Indian markets. Imports of toys will then automatically reduce and Indian toy-makers will prosper.

 
 
 


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