Benefits of foreign trade

Foreign trade is as old as history. Trade among countries is natural and desirable. It exists for different reasons, as the theories explain later will explain.

The factory means that the natural resources of the earth are evenly distributed. One country processes product X in surplus and lacks in respect of product y. In another country, the reverse may be true. Countries also differ in their preferences and technologies, scale, economics economic and social institutions, and capacities for growth and development. All this account forever growing foreign trade.

Whatever the reasons for the existence of foreign trade, there is no gainsaying the fact that external trade is significant for the economic development of the countries, particularly the developing ones. It provides the urge to develop the knowledge and experience that make development possible, and the means to accomplish it. An economy that has decided to embark on a program of development is required to extend its productive capacity at a faster rate. For these imports of machinery and equipment which cannot be produced in the initial stages at home, they are essential. Such imports which either help create new capacity in some lines of production or enlarge capacity in the other lines of production are called development imports. For instance, imports required for the setting up of Steel plant locomotives and hydroelectric projects are developments are imports. Second, a developing country that sets in motion the process of industrialization at home requires the imports of raw materials and intermediate goods to properly utilize the capacity created in the country.imports which is made to make full use of the productive capacity and called maintenance imports. These imports are vital for a developing economy as many of the industrial projects are also held up for lack of maintenance imports. For developing the economy, developmental and maintenance imports limit to the extent of industrialization which can be carried out in a given period. Besides these imports are developing economic is also required to import consumer goods which are in short supply at home during industrialization. Such imports are anti-inflationary because they reduce the scarcity of consumer goods.

Prof. Dr. Rashmi Gujrati Principal KCSMCA, Nawanshshr, Punjab , India

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Rashmi Gujrati

Prof. Dr. Rashmi Gujrati , Professor-Dean (International Affairs) CT University, India President-Editor-In-Chief Tradepreneur Global Academic Platform, UK (Institution of Research & Development) Qualification: M.com, MBA, Ph.D. Specialization: Marketing, Finance & International Business, Entrepreneurship. Editor-In-Chief International Journal of Business Operation Editorial Board member of (IJEFMS) Science Publish Group, USA Editorial Board Member of Academic for Global Business Advancement Association, USA Reviewer of Common Ground Research Networks University of Illinois, USA Reviewer IBIMA Association, Spain Scientific Review Committee, Advisory Board Member of AASE Member Chung Yuan Christiana University, Taiwan Scientific Board Member of InTraders Academic Platform, Turkey Editorial Board Member of Journal of Agriculture, Food, Environment and Animal Sciences, Turkey Indian Commerce Association Indian Accounting Association Indian College Principals Association Review & Editorial Committee Board Member Laescuela Education Scientific Committee Member of Research Synergy Foundation (RSF) Indonesia Editorial & Review Committee member FSSER Malaysia Editorial & Review Committee member GI-SSF Malaysia +919759347347

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