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Cross border capital flows and, in particular, direct investment have also grown enormously
Post war, World trade has grown faster than World GDP Almost all countries getting integrated with the global economy
Indian companies have also been venturing abroad for setting up joint ventures and wholly owned subsidiaries
GLOBALIZATION On or Off?
Economic "globalization" refers to the increasing integration of economies around the world, particularly through the movement of goods, services, and capital across borders. The term sometimes also refers to the movement of people (labor) and knowledge (technology) across international borders.
The term "globalization" began to be used more commonly in the 1980s, reflecting technological advances that made it easier and quicker to complete international transactions both trade and financial flows.
There are countless indicators that illustrate how goods, capital, and people, have become more globalized.
The value of trade (goods and services) as a percentage of world GDP increased from 42.1 percent in 1980 to 62.1 percent in 2007. Foreign direct investment increased from 6.5 percent of world GDP in 1980 to 31.8 percent in 2006. The stock of international claims (primarily bank loans), as a percentage of world GDP, increased from roughly 10 percent in 1980 to 48 percent in 2006. All these trends have continued beyond 2006 but some reversal is predicted after the current crisis and economic slowdown
The number of foreign workers has increased from 78 million people (2.4 percent of the world population) in 1965 to 191 million people (3.0 percent of the world population) in 2005.
3988
1305 433
SWAPS
US$ vs. OTHERS EURO vs. OTHERS JPY vs. OTHERS GBP vs. OTHERS
2250
2660.262 1139.406 509.731 460.779
208.790
* Indias net international liabilities increased by US $8.06 billion between end-March 2008 and end-March 2009, as the decline in international assets (US $ 35.64 billion) exceeded the decrease in international liabilities (US $27.58 billion).
* The decline in international assets was mainly on account of decrease in portfolio investments, both equity (about 0.7 billion), debt securities (about $67 million) and loans (a little over $5 billion).
* On the other hand, the decrease in international liabilities was mainly on account of the decrease in portfolio investment (equity securities) amounting to over US $35 billion
Gramm-Leach-Bliley Act
Summary of Provisions
TITLE I -- FACILITATING AFFILIATION AMONG BANKS, SECURITIES FIRMS, AND INSURANCE COMPANIES
Repeals the restrictions on banks affiliating with securities firms contained in sections 20 and 32 of the Glass-Steagall Act.
Creates a new "financial holding company" under section 4 of the Bank Holding Company Act. Such holding company can engage in a statutorily provided list of financial activities, including insurance and securities underwriting and agency activities, merchant banking and insurance company portfolio investment activities. Activities that are "complementary" to financial activities also are authorized. The nonfinancial activities of firms predominantly engaged in financial activities (at least 85% financial) are grandfathered for at least 10 years, with a possibility for a five year extension.