Importance of International Marketing Part - 1

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Macro level benefits in national perspective: International trade results in macro-economic effects for each economy. The imports and exports influence the employment, national income and technology. The direct and indirect benefits emanating from international business are listed below:

1. Increase in national Income : A country’s export activity promotes industrial and trade activity that generates employment and income for various sections of society. The multiplier effect of income increases the level of output and growth rate of economy. Especially the export of wage-goods can help a developing country to break the vicious circle of poverty and raise the real income of the country. 
2. Efficiency : While exporting, the countries try to attain specialization in production of goods. In this process, there is optimum and efficient utilization of the resources. The limited domestic market may act as a deterrent to the growth of industry and a resultant under-utilization of resources. The international trade can help industry grow and achieve scale and experience economies
3. Employment generation : Exports constitute a significant portion of different nations and breed opportunities for more and gainful employment. In addition to reducing direct unemployment, foreign trade reduces underemployment, e.g. exports of Swiss watches engages the farmers in the watch industry during their free time resulting into gainful utilisation of their skills.
4. Increased linkages : The staple theory of economic growth recognizes that foreign trade results into increased backward and forward linkages with other sectors of the economy. The industrial and trade linkages cause the development of new industries and enhance efficiency of existing indutries.
5. Optimal utilization of resources : International business makes possible the utilisation of agricultural resources as the farmers get a greater access to the overseas markets. This transforms even the subsistence sector into monetized sector raising the standards of living of rural populations. The strengths of Indian (12) agriculture are likely to open new vistas of business opportunities in the days to come as the world trade is likely to become more liberalised as a result of WTO provisions.
6. Promotes Foreign Direct Investment : The level of international business of a country often becomes a basis for the flow of foreign direct investment in a country. In today’s economic environment, it is difficult to grow in absence of FDI. Several economies have grown following the heavy investments from other parts of the world
7. Stimulates Competition : International business fosters healthy competition and helps in checking inefficient monopolies. It is established that growth of competitive economies is higher than the growth rate of protective economies. In recent times, the nations have realized the benefits of healthy competition. Several developing and erstwhile communist countries are promoting the same. Switching over to market-led growth which invokes substantially international operations in business, services and technology
8. Technology Sourcing : In today’s rapidly changing world, it is important to keep pace with the changing technology. This is possible only when there exist linkages with other national economies through international trade and business. The technologydriven industries such as information technology telecommunications, automobiles derive immense synergy by their participation in trade across the world.

Importance of International Marketing Part - 1