How significant is foreign trade in the context of growth and development of an underdeveloped economy like India?
Following points signify the importance of foreign trade for an underdeveloped economy like india.
a.Employment: For a developing country such as India, employment generation is an important objective and foreign trade of goods and services proves to be a boon for creating more employment opportunities.
b. International worthiness: Foreign trade also enhances India’s international worthiness and credibility. This increases the inflow of investment to India.
c. Contributes to human capital formation: Foreign trade of services through outsourcing helps in the development and formation of human capital by training and imparting them with advanced skills and thereby, increasing their future scope and suitability for high ranked jobs.