INTERNATIONAL BUSINESS

International Business refers to business activities that takes place across national frontiers.Though many people use the terms international business and international trade synonymously,the former is a much broader term.International business involves not only trade in goods and services,but also other operations such as production and marketing of goods and services in foreign countries.The reason behind this is that nations cannot efficiently produce all that they require.Due to differences in resource endowments and labour productivity,countries find it much more advantageous to produce goods and services in which they have cost advantage and trade the surplus in such goods and services which others can produce more efficiently.

International vs Domestic business: Conducting and managing the international business operations is more complex than undertaking domestic business.Differences in the nationality of parties involved,relatively less mobility of factors of production,customer heterogeneity across markets,variations in business practises and political systems,varied business regulations and policies,use of different currencies are the key aspects that differentiate international businesses from domestic business.These,moreover,are the factors that make international business much more complex and a difficult activity.

India's involvement in world business: Since time immemorial,India has been trading with foreign countries.Over the years,India's trade has registered spectacular growth.Currently foreign accounts for about 24 percent of the country's Gross Domestic Product.United States of America,United Kingdom,Belgium,Germany,Japan,Switzerland,Hong Kong,United Arab Emirates,China,Singapore and Malaysia are the major trading partners.These eleven countries together accounted for about forty eight percent of India's total trade.