🌐 What is International Trade?
International trade refers to the exchange of goods and services across international borders or territories. It helps nations access resources they lack and boosts their economy.
💱 Types of International Trade
- Bilateral Trade: Trade between two countries.
- Multilateral Trade: Trade among multiple countries under WTO or other trade agreements.
🔄 Barter System
The earliest form of trade involved direct exchange of goods and services without the use of money. This system was based on mutual need and existed before the development of currency.
⛓️ Slave Trade (Colonial Period)
During the colonial period, slave trade became a major international trade. Millions of Africans were captured and transported across the Atlantic to work on plantations in the Americas.
🧵 Silk Route
The Silk Route was an ancient network of trade routes that connected China to Europe and the Middle East. It facilitated trade in silk, spices, and precious goods, and also enabled cultural exchange.
📊 Basis of International Trade
- Difference in Natural Resources: Uneven distribution leads to trade between regions.(A)geological structure (B)minerals (C)climate
- Population Factors: Population size and demand affect trade volumes.(A)Cultural factors (B)Size of population
- Stage of Economic Development: Developed countries trade in capital goods, developing ones in raw materials.
- Extent of Foreign Investment: Investment boosts exports and imports.
- Transport and Communication: Efficient infrastructure supports trade.
- Trade Policies: Liberal or restrictive trade policies affect international trade volume.
📉 Dumped Goods
Sometimes, countries export surplus goods at very low prices, known as dumping. It can harm local industries in the importing country and create unfair competition.
🌐 WTO (World Trade Organization)
WTO is an international organization that promotes free and fair global trade. It helps resolve trade disputes, Headquarters- Geneva,Switzerland,GATT- General Agreement for tariff and trades(1948) then on 1 jan 1995 it was converted into WTO.
⚓ Types of Ports
a) Based on Cargo Handled
- Industrial Ports: Export of manufactured goods and raw materials.
- Commercial Ports: Deal with import/export of general cargo and passengers.
- Comprehensive Ports: Handle both bulky cargo and passengers.
b) Based on Location
- Inland Ports: Located away from the sea, connected by rivers or canals (e.g., Kolkata).
- Out Ports: Built away from congested ports to handle overflow (e.g., Rotterdam).
c) Based on Specialised Function
- Oil Ports: For shipment of petroleum (e.g., Kharg Island, Iran).
- Port of call Ports: Where ships anchor for refuelling,watering,food items (e.g., Singapore).
- Entrepôt Ports: These work as collection centers Goods are imported from far places and re-exported to nearby places (e.g., Dubai).
- Naval port: For Navy and security purposes.(Kochi in India)
- Packet station: For transportion of cargo and passenger usally for short distances(dover in England and Calais in France)
⚠️ Concerns Related to International Trade
- Unequal distribution of benefits between developed and developing countries.
- Exploitation of natural resources and labor in poorer nations.
- Trade imbalances and economic dependency.
- Environmental degradation due to overproduction and shipping.
- Impact of political tensions and trade wars on global markets.
📦 India's Trade Composition
India exports textiles, gems, petroleum products, software, etc., and imports crude oil, gold, electronics, and machinery.
🚢 Major Trade Routes
Includes sea routes like the Suez Canal, Panama Canal, and air routes connecting major global cities.
📈 Importance
Boosts economic growth, creates employment, and strengthens international relations.