Question

Discuss the volume of international trade, and explain the role government and chance play in the growth of international trade.

Answer 1

International trade is also known as importing and exporting. It means buying and selling of goods and countries between multiple different countries. It gives a rise to the world economy as a whole. It helps a country to grow and develop their international relations. Moreover, entrepreneurs get benefit when it comes to trading on a larger scale or internationally.

Government plays a very important role in the process of international trade. It can be good or bad. Government keeps on analyzing every single factor to check if international trade is healthy for its country. It can encourage or discourage the whole trade process. Some countries need foreign investments, so they allow international trade and FDIs but not every country allows it. Sometimes government checks the capabilities of domestic industry if they can bear up with foreign investments. Most of the times, poor countries or less developed/developing countries don’t allow international trade.

Government can even play a very important role while contributing to the growth of international trade using introducing various policy measures. It can use fiscal and monetary policies depending on the need of hour to increase the trade. All barriers can be removed. More investments can be made with foreign banks. For example, government introduced the policy of liberalization in 1991 in India. It helped the country to grow its international trade and relations.