1.1 BACKGROUND OF THE STUDY
Globalization refers to increasing global connectivity, integration and interdependence in the economic, social, technological, cultural, political and ecological spheres. Globalization is an umbrella term and is perhaps best understood as a unitary process inclusive of many sub- processes (such as enhanced economic interdependence, increased cultural influence, rapid advances of information, technology and novel governance and geopolitical challenges) that are increasingly binding people and the biosphere more tightly into one global system.
In economics, globalization is the convergence of prices, products, wages, rates of interest and profits towards developed country norms. Globalization of the economy depends on the role of human migration, international trade, movement of capital and integration of financial markets.
The international monetary funds notes the growing economic interdependence of countries world wide through increasing volume and variety of cross border transactions, free international capital flows and more rapid and widespread diffusion of technology.
Some view it as a “Process by which the experience of everyday life is becoming standardized around the world”. While some scholars and observers of globalization stress convergence of patterns of production and consumption and a resulting homogenization of culture. Others stress that globalization has the potential to take many diverse forms.
Generally, the economists view globalization rather positively. They see globalization as free “the force of competition that help to channel the energies of people and the resources of countries into activities that are likely to be more productive. In a competitive global market, different countries will specialize in the products they can produce best
1.2 STATEMENT OF PROBLEM
Globalization has made significant impact on businesses in the rural areas, but there are some limitations. First trade restriction and restructure of fiscal policies make it difficult for rural business management to have free and unrestricted access to the global market.