INTERNATIONAL BUSINESS - Overview
INTERNATIONAL BUSINESS
The world has become a ‘global village’. Business has expanded and is no longer restricted to the physical boundaries of a country. Even countries which were self-reliant are now depending upon others for procurement of goods and services. They are also ready to supply the goods and services to developing countries. There is a change from self-reliance to dependence. This is because of the development of new modes of telecommunication and infrastructure facilities like faster and efficient means of transportation. They have brought countries closer to each other.
Besides development in technology, infrastructure and communication efforts of World Trade Organisation (WTO) and the reforms carried out by governments of different countries have also been a major reason for increasing commercial interactions among the countries.
India has been trading with other countries for a long time but now it has caught up in the process of globalisation in a big way and is integrating its economy with the world economy.
International business refers to those business activities that take place beyond the geographical limits of a country. It involves not only the international movements of goods and services, but also of capital, personnel, technology and intellectual property like patents, trademarks, knowhow and copyrights.
International business refers to those business activities that take place beyond the geographical limits of a country.
DEFINITION
- “International business consists of transactions that are devised and carried out across national borders to satisfy the objectives of the individuals, companies and organisations. These transactions take on various forms which are often interrelated.” – Michael R. Czinkota
- “International business involves commercial activities that cross national frontiers” – Roger Bennett
It is a business which takes place outside the boundaries of a country, i.e., between two countries. It includes the international movements of goods and services, capital, personnel, technology and intellectual property rights like patents, trademarks and knowhow. It refers to the purchase and sale of goods and services beyond the geographical limits of a country.
It is of three types:
- Export Trade – It is selling of goods and services to foreign countries.
- Import Trade – It is buying goods and services from other countries.
- Entreport Trade – It is import of goods and services for re-export to other countries.
